Trading USD/SGD

The USD/SGD is the world’s 10th most traded forex pair. The minor forex pair is made up of the US dollar (USD) and the Singapore dollar (SGD), two of the world’s strongest and most stable currencies. The past decade has seen a period of productive collaboration between the countries which has cultivated a promising investment opportunity.

The pair offers an accessible route into the Pacific market, but whilst it may attract investors from all over the world, generating a profit is not easy. This page will break down everything you need to know about trading USD/SGD. From exchange rates to forecasts, trends and technical analysis, read on to find out what this pair has to offer.

USD/SGD Trading Brokers

Forex.com are a leading forex broker. Offering the largest range of currency pairs (80+) and some of the tightest spreads in the industry.
NinjaTrader offer Traders Futures and Forex trading. Use Auto-trade algorithmic strategies and configure your own trading platform, and trade at the lowest costs.
Trade with leverage on the FX market.
The leading US trading Exchange. Nadex offer genuine exchange trading to US clients on Binary Options. Fully regulated by the CFTC.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
Rockfort Markets offers competitive pricing on a wide range of major, minor and exotic currency pairs through MT4 and TWS.
Exinity Trader Pro supports major, minor and exotic forex trading on MT4 and MT5 platforms.
Trade on a handful of the most traded currency pairs with leverage.
Use digital options to take straightforward buy and sell positions on a range of currencies.
Trade on FX pairs with 1:500 leverage.
Zulutrade provide multiple automation and copy trading options across forex, indices, stocks, cryptocurrency and commodities markets
IB Boast a huge market share of global trading. With a minimum deposit of $10,000 however, they remain an option for larger traders only.
One of the largest discount brokers in the US, with a fixed trading commission and access to a large array of trading products and securities
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USD/SGD Economies

Historically, the Singapore dollar has served as an investment haven for traders. This is due to Singapore’s high interest and growth rates, loose controls and less developed labour markets. The combination of which makes for an appealing investment option.

Furthermore, Singapore has seen significant economic growth in recent years. It now stands as one of the wealthiest economies in the Asia-Pacific region and rivals even the largest of the Western states; such as the UK, France and the US.

How to trade USD/SGD

The strength of Singapore’s position is in part due to its geography. It lies at the heart of several major international shipping routes, perfectly positioning it to be one of the world’s biggest international trading hubs. Singapore operates a free-market economy that heavily relies on international trade. The high dependency on trade means that fluctuations in foreign exchange markets can have significant implications on the value of the SGD.

Why Trade USD/SGD

  • Volatility – Consistent with trading any of the world’s foremost forex pairs, the USD/SGD offers high volatility. Whilst it carries risk, highly volatile pairs offer an opportunity to make big returns on relatively small investments.
  • Volume – As a popular currency pair offering an easy route into the Pacific market, relatively large trade volume means that the pair offers a great opportunity for traders to turn a profit. When coupled with high volatility, it can make for even bigger profits.
  • Availability of resources – Traders today have access to a whole host of tools, charts and analysis. Short and long-term forecasts and trends are more easily predicted. Resources include, but are not limited to, live exchange rates, candlestick and yearly-average charts, historical data and a range of real-time quotes.
  • Regulation – Although the SGD is regulated by the Monetary Policy of Singapore, it is subject to much fewer restrictions than some of its neighbouring currencies, such as the Chinese Yuan. Alongside the Japanese Yen, the SGD is one of the most accessible Asian currencies in today’s forex markets.

Risks Of Trading USD/SGD

Whilst there are benefits of live trading USD/SGD, there are also drawbacks to consider:

  • Volatility – As with most forex pairs, the USD/SGD has a history of volatility. Whilst this can be an advantage, traders should be wary of how quickly prices can swing. Price charts, technical analysis, predictions and forecasts are useful but may not always be enough, meaning traders should ensure they keep up to date with economic news and forecasts.
  • Settlement risk – Settlement risk occurs as a result of the difference in time zones. Currencies may be traded at different prices at different times during the day. AUD and NZD are credited first, followed by JPY, SGD, the European currencies and then the USD. Payments could be credited to a party that declares solvency, prior to executing its own payments. To minimise risks, traders should consider not only the market value of their positions but also the potential exposure of these positions.
  • Leverage – Low margin deposits may permit a high degree of leverage. As a result, relatively minor price changes may result in substantial losses. For example, if 10% of the price was deposited as margin, a price decrease of 10% would result in the total loss of the margin. On top of which, broker fees are taken. Traders should adhere to strict risk management strategies when investing to minimise losses and facilitate long-term trading.
  • Automated bots – In today’s markets competition is fierce. The sophistication and prevalence of advanced trading algorithms can make it tough to establish an edge. Bots will automatically enter and exit positions when favourable so USD/SGD traders must utilise live charts, trend forecasts, graphs, and currency news to remain competitive. There are many currency converters and analysis resources available, some of the most popular include Oanda and Yahoo Finance.

Influences On USD/SGD Price

  • Economic growth – The strength of an economy heavily influences the value of its currency. Indications of economic prosperity can be measured by employment levels, rates of interest and inflation. A weakening economy will see high levels of each. Singapore boasts low levels of unemployment and a well-educated workforce compared to the US, however, these are factors that have already been priced into live rates. Traders should ensure they remain abreast of economic news relating to both countries.
  • Value of raw materials – Singapore relies heavily on imports of raw materials to facilitate its export industry. When the price of these materials increases, Singapore’s exports become more expensive and less competitive. Exports make up much of the country’s GDP and as a result, any change to the value of its exports will affect the strength of the currency as a whole.
  • Political stability – Major political events such as presidential elections can have a significant impact on the value of USD versus SGD. When the value of the USD rises, it will strengthen against the SGD. When the value of USD drops, it will weaken against SGD.
  • Monetary policy – Monetary policy is controlled by the MAS and the Fed which are the central banks of Singapore and the US respectively. Any changes to monetary policy made by the banks will heavily influence movement on live charts.
  • Speculation – Currency speculation is when traders feel that a quoted price is incorrect and so buy and sell currency to make a profit. For example, if a currency is overvalued, traders would sell their reserves which could trigger a fall in price. Speculation can have a big impact on the price of a currency. If there were to be mass selling of the USD it would fall against the SGD. The reverse is also true.

USD/SGD Currency Correlations

No single currency moves independently of others. Currency pairs are all intrinsically linked. As a result, changes in any single currency can have implications for others. A change in the Euro for example would affect the price of USD, which in turn affects the price of SGD.

Currency pairs either have a positive correlation or a negative correlation:

  • Positive – This is when pairs move in line with each other. EUR/USD, GBP/USD and AUD/USD are all positively correlated. Any change in USD tends to see each pair move in a similar direction. SGD is somewhat correlated with CNY but it is subject to less severe regulation. A change in the value of the Chinese Yuan tends to be mirrored by SGD.
  • Negative – This is when pairs move in opposite directions from each other. USD/JPY, USD/CHF and USD/CAD are all negatively correlated. Any change in the USD, which is the counter currency, will typically lead each pair to move in the opposite direction.

Application

Traders can use the relationships between pairs to their advantage. For example, when trading the GBP/USD, keep an eye on the Euro/US Dollar which can inform investment options. Although there are additional factors that affect movements such as economic policy and political events, it is worthwhile to have an understanding of the relationships between currency pairs.

USD/SGD investing

USD/SGD Trading Strategy

An effective day trading or futures USD/SGD strategy should be more than just knowing how to use pip values to your advantage. Different strategies will work to facilitate different aims in different environments, so traders should always consider their objectives. Whether you prefer to use swap or forward rates or rely heavily on daily, 5, 10 or even 30-year charts, there are some basics that offer a good starting point.

Timing

Unlike some stock markets, forex trading usually operates between normal business hours. Although there is no ‘best time’ to trade, there are certain windows that tend to be more favourable.

The optimum time to trade forex is when the market is most active. During these periods, the trading spreads (mid rates) tend to narrow. This means less money goes to the market makers and more money goes directly to traders. When two markets are open at the same time, market volume increases dramatically, as does volatility. Both of which can translate to greater returns for traders. Between 17:00 GMT and 18:00 GMT is when most trading happens on the Singapore and Sydney exchanges. As a result, it’s a prime time to trade USD/SGD.

Risk Management

A tight risk management strategy should form the foundation of any USD/SGD trading strategy. The 1% rule is a popular risk management strategy that lends itself to most objectives. The rule dictates that a trader should never invest more than 1% of their portfolio on any given trade. In doing so, investors minimise losses and increase the opportunity for long-term USD/SGD trading. Establishing stop/loss limits is another risk management technique that can prove beneficial.

USD/SGD Price History

The SGD was adopted as the official currency of Singapore in 1967. Initially, it was exchanged at par with the Malaysian Ringgit but in 1973 it was pegged to the GBP, followed by the USD for a short time. Today, it is pegged to a trade-weighted basket of currencies.

The Singapore dollar is regulated by Singapore’s central bank, the Monetary Authority of Singapore (MAS), which was established in 1971. The USD/SGD has seen a relatively stable history but as with any forex pair, spot buying and selling rates are heavily influenced by political and economic factors.

Note, a view of USD to SGD historical conversions are available at online FX brokers.

Final Word On Trading USD/SGD

Trading USD against SGD can provide an opportunity to generate returns. The relative stability of the pair makes for an attractive proposition for both forex beginners and more experienced traders. Whilst global events over recent months and years have made it increasingly difficult to forecast future trends, the outlook for the pair in 2021 looks promising.

FAQ

How is USD/SGD quoted?

The USD/SGD illustrates the number of Singapore dollars you can purchase for one US dollar. The conversion rate varies throughout the day. See a live chart for a real-time update.

What is the USD and SGD exchange rate history?

There are multiple resources available online where traders can view historical price data, including at leading FX brokers. Having an understanding of how a currency pair has behaved previously, can help traders to forecast how it may move in the future.

How can I work out the USD into SGD conversion?

There are a host of tools and resources available online that chart live rates. Most are free to use when you sign up for a forex trading account.

What impacts the USD/SGD exchange rate?

The value of the USD/SGD is influenced by several factors, but primarily the strength of the respective economies. News announcements, interest rate changes, GDP data, and political events can all shift prices.

What is the USD to SGD selling rate?

The selling rate or conversion rate is the number of SGD required to buy one US dollar. Most top forex brokers and currency converters offer competitive FX rates.