The decline starting from 1.6448 on the 4th of February has ended on 21st of April at 1.5142. There was a re-test of the low but it ended with a failure at 1.5160. Since that failure, price has moved higher and 2 weeks ago, price broke the highest point in between the two highs, triggering a confirmation of a Double Bottom chart pattern formation as well as an Ichimoku reversal pattern. This week, price has not only stayed above the neckline but has continued to move higher.
MACD had a divergence warning with price when price was making the low at 1.5142. MACD has confirmed the current price rally with a movement above the zero line. MACD is now bullish. Stochastic has a bullish crossover and is moving higher, hinting of further price movement higher.
The Double Bottom has a price target at 1.5836. Ichimoku 3E price projection has a target at 1.6140, which is just above the previous high of 1.6108.
The European Central Bank has kept interest rate near to zero for the longest time and EUR/SGD had lots of time to adapt to the low interest rate of the single currency. This has probably been factored in by the market. The Euro zone GDP has been stable from 0.2% to 0.7% and this has probably been factored into the Euro weakness as well. Singapore GDP growth on the other hand had weakened. Singapore already had 2 quarters of negative GDP growth in 2019 and has been lucky to avoid a technical recession.
We are bullish on EUR/SGD and we think price is likely to advance to 1.5830 and possible to 1.6110. Risk management stop can be placed nearby at 1.5400.