Forex Market: AUD/SGD trading forecast for Monday

Friday’s trade saw AUD/SGD within the range of 1.1584-1.1617. The pair closed at 1.1611, gaining 0.02% on a daily basis, while losing 0.05% for the whole week.

Fundamental view

Australia

At 1:30 GMT on Monday the Australian Bureau of Statistics is scheduled to report on new motor vehicle sales in the country for July. New vehicle registrations rose to 94 389 vehicles in June from 92 836 in May, or a 1.7% increase. A record high number of new vehicle registrations in Australia was recorded in September 2012 (98 241). New car sales, as an indicator, reflect how strong consumer confidence is. In case consumers are willing to make large-ticket purchases, such as new automobiles, this suggests they have greater confidence regarding their financial prospects. However, as new car sales account for a small portion of Australian Gross Domestic Product, a potential increase would have a limited bullish impact on the national currency.

Singapore

The surplus on Singaporean trade balance probably decreased to 3.948 billion SGD in July, according to the median forecast by experts, from 5.890 billion SGD in June. Total exports rose 3.9% to 43.52 billion SGD in June on annual basis, supported by oil sales, while at the same time nations non-oil exports decreased 4.6%. Total imports rose at an annualized rate of 0.89% to 37.63 billion SGD in June.

The trade balance, as an indicator, measures the difference in value between country’s exported and imported goods and services during the reported period. It reflects the net export of goods and services, or one of the components to form country’s Gross Domestic Product. Generally, exports reflect economic growth, while imports indicate domestic demand.

Singaporean economy is highly reliant on export of high-value added products. Main exports include electronic goods, accounting for 31% of total exports, fuel (26%) and chemicals (12%). Singapore imports fuel (33% of total imports), electronic components (25%), machinery (16%), manufactured goods (5%). Nations largest trading partners are China and Malaysia.

In case the trade balance surplus contracted more than anticipated, this would have a bearish effect on the Singaporean dollar. Statistics Singapore is expected to release the official numbers at 5:00 GMT.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.1604. In case AUD/SGD manages to breach the first resistance level at 1.1624, it will probably continue up to test 1.1637. In case the second key resistance is broken, the pair will probably attempt to advance to 1.1657.

If AUD/SGD manages to breach the first key support at 1.1591, it will probably continue to slide and test 1.1571. With this second key support broken, the movement to the downside will probably continue to 1.1558.

The mid-Pivot levels for Monday are as follows: M1 – 1.1565, M2 – 1.1581, M3 – 1.1598, M4 – 1.1614, M5 – 1.1631, M6 – 1.1647.

In weekly terms, the central pivot point is at 1.1611. The three key resistance levels are as follows: R1 – 1.1639, R2 – 1.1666, R3 – 1.1694. The three key support levels are: S1 – 1.1584, S2 – 1.1556, S3 – 1.1529.