FxNews—The U.S. Dollar’s downtrend eased near the June 28 low at approximately 7.805 against the Hong Kong dollar. As of writing, the USD/HKD currency pair trades at about 7.807 and rising, which was expected because the stochastic oscillator floats in oversold territory. Interestingly, the chart formed a longwick bullish candlestick pattern in the 4-hour chart.
The diagram below demonstrates the USD/HKD key levels, currency price, and technical tools utilized in today’s analysis.
USDHKD Technical Analysis – 12-July-2024
The technical indicators in the 4-hour chart suggest the primary trend is bearish, but the Hong Kong dollar is overpriced against the American currency. The market could step into a consolidation phase, or the trend might reverse from bearish to bullish.
- The awesome oscillator bars are red and below the signal line, recording -0.003 in the description, meaning the primary trend is bearish.
- The relative strength index value increases from the 30 level, signifying that the downtrend eases.
- The stochastic oscillator %K line value is 14, meaning the market is oversold.
- The USD/SGD price is below the 50 and 100-period simple moving average, which proves the robust bearish bias.
USDSGD Forecast – 12-July-2024
From a technical standpoint, the market is bearish but oversold, and the price might bounce from the key support level at 7.85. If the USD/SGD exchange rate remains above the aforementioned support, the pullback could test the 38.2% Fibonacci retracement level at 7.808. Furthermore, if the buying pressure exceeds 7.808, the next resistance area will be the 38.2% Fibonacci at 7.808.
It is worth mentioning that the bullish scenario should be invalidated if the price dips below the 7.805 key resistance.
USD/SGD Bearish Scenario
The key support level that allowed the bearish trend to continue is 7.806. If the bears (sellers) push the price below 7.806, the downtrend will likely resume, and the next support level will be the June 21 high, the 7.804 mark.
Conversely, the bearish scenario should be invalidated if the price exceeds 38.2% Fibonacci.