What is USDSGD trend? How will it turn out in 2014?
Singapore Dollar one of best long term currency investments
The USDSGD pair is currently trading around 1.27. Few will remember that once upon a time it was doing 1.85. In my story ‘Why should individuals in foreign currencies?‘ I recalled
Based on the 2001 exchange rate of 1.85 nine years ago, it took 54 US cents for a US citizen to buy 1 Singapore Dollar (an investment in a foreign currency to him). Nine years later, this savvy investor would receive 83 US cents (his native currency) when he sold his 1 Singapore Dollar. That is an amazingly sexy long term capital appreciation of 29 cents or 54% gain.
After 3 years of consolidation, will 2014 be a watershed for USDSGD?
I invite members of this community to comment, predict where USDSGD will head. As an incentive, the best three responses before 6pm tomorrow will receive three support class vouchers worth S$120 (1. only Tflow® students qualify 2. cannot be used to redeem cash 3. must use by end June 2014).
As a reminder, some technical analysis concepts involved:
- Previous trend (2009 – 2011) is down.
- Price action continues to print lower annual highs.
- Price consolidated in a triangle chart pattern over the past three years; this is an exchange of hands as early entrants take profit while late entrants position themselves.
- USDSGD technical picture the last time we looked.
- USDSGD will continue to get squeezed as it moves towards an ‘apex’ where it has to breakout at some time.
For non-Singaporeans, an easy way to expose oneself to the currency is through this ETF.