Daily Markets

• The dollar softened against its major peers on Wednesday, helping the euro to a near eight-month peak, as the U.S. consumer price index showed inflation is subsiding, reinforcing expectations that Federal Reserve interest rate cuts are near. U.S. CPI rose moderately in July and the annual increase in inflation slowed to below 3% for the first time since early 2021, adding to expectations for a rate cut next month, though likely less aggressive than markets hoped for. The report adds to the mild increase in producer prices in July in suggesting that inflation is on a downward trend. This should give the Fed room to focus more on the labor market amid growing concerns of a sharp slowdown. The euro was last up 0.18% against the greenback to $1.1014, surpassing the high hit during the market turmoil last week, and was trading at its strongest level since Jan. 2. The dollar index was slightly lower at 102.57. Traders had been widely expecting a rate cut in September before the producer price data, and ramped up bets for a 50 basis-point cut after the release to 56% from 53% a day earlier, according to CME Group's. Sahota thinks the market is still on track for three 25 bps cuts this year from the Fed, rather than 100 bps by the end of the year. Sterling failed to gain on the weaker dollar and was down 0.29% at $1.2825 after data showed the rise in British consumer price inflation was smaller than expected in July as services prices - closely watched by the Bank of England - rose less rapidly. The pound did soften on the euro, however, which was up 0.47% at 85.87 pence. Financial markets priced in a 44% chance of a quarter-point BoE rate cut in September, up from 36% before the data was released. Meanwhile, Japanese Prime Minister Fumio Kishida's decision to not run for reelection in his party's leadership race next month had little effect on markets, analysts said. The yen was last trading at 147.26 against the dollar.

Gold – XAU

Gold on made its intraday high of US$2472.80/oz and low of $2423.70/oz. Gold is up by 1.735% at S$2471.77/oz.

Technicals in Focus:

On the daily charts, gold trades higher than 20DMA (2197). If it drops below this level, it could lead to 2,100. The MACD is currently above the zero line and the histograms are showing an increasing trend, indicating that there may be upward movement in the coming sessions. The RSI is currently at 83.04, which is in the overbought region, suggesting there may be selling pressure in the next 2 to 3 sessions. The Stochastic Oscillator is also in the overbought territory but has given a positive crossover, indicating a bullish stance for intraday trades, but rebound in expected in all the overbought indicators.

Trading Strategy: Sell on Strength

Sell below 2464-2520 keeping stop loss closing above 2520, targeting 2459-2431-2418 and 2400-2384-2370. Buy in between 2431-2370 with risk below 2370 targeting 2470-2484 and 2490-2500-2512.

Silver - XAG

Silver on Wednesday made its intraday high of US$28.01/oz and low of US$27.15/oz settle down by 1.045% at US$27.54/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 20MA (25.05), breakage above will lead to 23.73. MACD is below the zero line and histograms are increasing trend, bringing a bullish stance in the upcoming sessions. RSI is in the oversold region, indicating a sell signal for now. The Stochastic Oscillator is in the overbought region and gives a positive crossover to show an upside move for the intraday trade.

Trading Strategy: Buy on Dips

Buy in between 27.00-25.90, targeting 28.00-28.50-29.70 and 30.50-31.10- 31.90 with stop loss should be placed on the breakage below 25.00. Sell in between 27.90-31.00 with a stop loss above 31.50 targeting 27.60 and 27.10-26.50-26.00.

Oil - WTI

Crude Oil on Wednesday made an intra‐day high of US$77.57/bbl, an intraday low of US$75.68/bbl, and settled up by 1.39% to close at US$76.03/bbl.

Technicals in Focus:

On daily charts, oil is sustaining above its 100DMA i.e. 75.37, a support level, and breakage above will call for 77.48. MACD is above the zero line and histograms are in increasing mode will bring a bullish stance in the upcoming sessions. The Stochastic Oscillator is in the overbought region, giving a negative crossover to confirm a bearish stance; while the RSI is in the neutral region, more upside can be expected to reach the overbought region, which is highly probable.

Trading Strategy: Neutral to Sell

Sell in between 77.50-82.00 with stop loss at 82.00; targeting 75.10-74.50-73.90 and 73.10-72.50-71.90-71.00. Buy above 76.10-71.00 with risk daily closing below 71.00, targeting 78.10-78.75-79.80 and 80.40-80.85-81.50.

EUR/USD

EUR/USD on Monday made an intraday low of US$1.0909/EUR, a high of US$1.10938/EUR, and settled the day up by 0.178% to close at US$1.0930/EUR.

Technicals in Focus:

On daily charts, prices are sustaining above 100DMA (1.0800), which becomes immediate support, a break below will target 1.0717. MACD is above the zero line and histograms are increasing mode, bringing a bullish view. Stochastic is in oversold territory, giving negative crossovers to the bullish outlook for intraday. 14D RSI is currently in a neutral region and giving no directions to consider right now.

Trading Strategy: Neutral to Sell

Sell below 1.0960-1.1100, targeting 1.0700-1.0640-with stop-loss at daily closing above 1.1100. Buy above 1.0900-1.0450 with risk below 1.0400 targeting 1.0845-1.0890 and 1.1020-1.1105-1.1145.

GBP/USD

GBP/USD on Wednesday made an intra‐day low of US$1.2813/GBP, a high of US$1.2867/GBP, and settled the day down by 0.2799% to close at US$1.27822/GBP.

Technicals in Focus:

On daily charts, prices are sustaining above 50DMA (1.2674) is becoming a support level. 14-D RSI is currently in a neutral region and direction is difficult to predict on an RSI basis. The Stochastic Oscillator is in oversold territory and gives a positive crossover to confirm a bullish stance. MACD is above the zero line, but histograms are increasing leading to movement.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy in between 1.2800-1.2500 with a target of 1.2890-1.2990-1.3040 and 1.3100-1.3150 with a stop loss closing below 1.2050. Sell in between 1.2850-1.3100 with targets at 1.2790-1.2720 and 1.2670-1.2610-1.2500 with a stop loss of 1.3100.

USD/JPY

USD/JPY on Wednesday made an intra‐day low of JPY146.06/USD an intraday high of 147.57/USD, and settled the day up by 0.442% at JPY147.28/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 100DMA (155.35), major support on the daily chart. 14-D RSI is currently in the overbought region and chances of downward are expected based on RSI. MACD is above the zero line but histograms are in decreasing mode which might lead to downward movement. The Stochastic Oscillator is in overbought territory and signaling to sell as it has given a negative crossover to confirm a bearish stance.

Trading Strategy: Neutral to Sell

Sell below 147.90-150.00 with risk above 150.00 targeting 145.00-144.20-143.60 and 142.90-141.70-141.00. Long positions above 146.00-141.00 with targets of 146.00-146.45-146.90 and 147.50-148.40-149.00 with stops below 146.00.