The EUR is weakening against most currencies due to the continued economic recession anf high budget deficit in Italy. The deals to Sell seem the most effective in the medium term.
The uptrend gradually transformed into a weak downtrend, which was formed under the influence of the economic slowdown in the EU and the ECB's soft monetary policy. At the same time, the economic situation in Singapore is similar and is also on the decline. Despite the fact that the Singaporean dollar is not a commodity currency, it does depend on the development of the trade conflict between the US and China because a significant part of the products are exported to China.
This week the Euro fell against most currencies due to the conflict between the EU and Italy. The problem arose because of the high budget deficit in Italy which does not meet EU standards. Another negative argument was the PMI manufacturing index, which fell to 53.2 points in September, the ninth consecutive decline after reaching the maximum value in December 2017. Investors regarded this as a signal of a continued recession in the economy, which had a negative impact on the value of the euro. Another negative signal for investors was a decrease in retail sales in August by 0.2%, while a growth by 0.2% was expected. At the same time, the unemployment rate in the EU was 8.1%, as expected on the market, the lowest value in the last 10 years. This fact allowed the euro to stop its decline and strengthen, which has been happening until now.
Next week data about Singapore's GDP for the 3rd quarter of 2018 is expected, as well as data on retail sales. Investors have forecasted a GDP growth by 1.2%, that is twice more than in the previous period. If the forecasts coincide with the actual data, the SGD has all chances to continue strengthening against the Euro. Up to this point, the incentives to strengthen most likely will not be enough and volatility will be weak in the absence of a news background. The MACD and Stochastic oscillators are showing mixed signals. Nevertheless, the most optimal move in the current situation are the short-term deals according to the trend, which can be effective in the medium term.
