Brent signals a top in Singapore Dollar / Malaysian Ringgit?
The exchange rate of SGD/MYR have always been rising within in a predictable channel since 2006.
Given that Malaysia is still the only net oil exporter, the collapse in oil price in late 2014 caused a 'disconnect' with exchange rate surging above the rising channel.
Focusing on SGDMYR exclusively allows us to ignore the trend of a rising interest rate hike ahead by the FED, since Singapore Dollar is indirectly affected at the same rate too. MYRUSD had almost 80% correlation to Brent oil.
At this point in time I think it is rather overbought given the historical RSI and a higher high SGDMYR made despite Brent oil not making a lower low.
There's certainly still space for further rally, and I will not be shorting immediately but having a short entry at 2.8271 opened to be filled.
Entry: 2.8343
Stop-loss: 2.8857
Take-Profit: 2.5322 (with trailing stops)
Given that Malaysia is still the only net oil exporter, the collapse in oil price in late 2014 caused a 'disconnect' with exchange rate surging above the rising channel.
Focusing on SGDMYR exclusively allows us to ignore the trend of a rising interest rate hike ahead by the FED, since Singapore Dollar is indirectly affected at the same rate too. MYRUSD had almost 80% correlation to Brent oil.
At this point in time I think it is rather overbought given the historical RSI and a higher high SGDMYR made despite Brent oil not making a lower low.
There's certainly still space for further rally, and I will not be shorting immediately but having a short entry at 2.8271 opened to be filled.
Entry: 2.8343
Stop-loss: 2.8857
Take-Profit: 2.5322 (with trailing stops)