Daily Markets

• Most Asian currencies gained ground on Wednesday as the dollar retreated in the wake of a fiery U.S. presidential debate, with focus turning to key upcoming inflation data due later in the day. The Japanese yen was among the biggest beneficiaries of this trade, with increased safe haven demand after the debate putting the yen at its strongest level since early-January. The yen also benefited from somewhat hawkish-leaning comments from Bank of Japan officials. Broader Asian currencies advanced on Wednesday, seeing some relief from a softer dollar. But regional markets were still nursing steep losses over the past week amid waning risk appetite. The dollar index and dollar index futures both fell about 0.2% in Asian trade, with losses in the greenback coming in the wake of a fiery presidential debate between Kamala Harris and Donald Trump. The debate furthered expectations for a hotly contested 2024 presidential race, which could present a major point of uncertainty for markets, given the contrasting views on policy pushed by both candidates. Harris and Trump both veered from the presented topics to engage in personal attacks against each other. The dollar was also on the backfoot ahead of key consumer price index inflation data due later in the day, which is widely expected to provide more cues on interest rates. The reading comes just a week before a Federal Reserve meeting, where investors expect the central bank to cut rates by at least 25 basis points. The currency benefited from some safe haven plays, as uncertainty over the U.S. election ramped up after Tuesday’s debate. But a main point of support for the yen was hawkish comments from BOJ member Junko Nakagawa, who said that the central bank will continue to raise interest rates if inflation moves in line with its forecast. Nakagawa’s comments come following a slew of hawkish signals from the BOJ, and were also made just a week before a BOJ meeting. Investors are uncertain over another rate hike by the central bank, following a 15 basis point raise in late-July. Broader Asian currencies advanced, albeit slightly, as focus turned to the upcoming U.S. CPI reading.

Gold – XAU

Gold on Tuesday made its intraday high of US$2518.35/oz and low of $2500.01/oz. Gold is up by 0.364% at S$2516.32/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 2510-2560 keeping stop loss closing above 2560, targeting 2,490-2,484-2,470 and 2459-2431-2418. Buy in between 2490-2430 with risk below 2430 targeting 2512-2,520-2531 and 2545-2560.

Silver - XAG

Silver on Tuesday made its intraday high of US$28.53/oz and low of US$28.01/oz settle up by 0.187% at US$28.37/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 28.00-25.90, targeting 28.50-29.00-29.70 and 30.50-31.10- 31.90 with stop loss should be placed on the breakage below 25.00. Sell in between 28.50-31.00 with a stop loss above 31.50 targeting 28.00-27.60 and 27.10-26.50-26.00.

Oil - WTI

Crude Oil on Tuesday made an intra‐day high of US$68.45/bbl, an intraday low of US$64.73/bbl, and settled down by 3.43% to close at US$65.76/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 66.00-73.90 with stop loss at 74.00; targeting 65.00-64.20-63.50 and 63.00-62.00 Buy above 65.00-62.00 with risk daily closing below 62.00, targeting 66.00-66.70-67.30 and 68.00-68.90-69.60.

EUR/USD

EUR/USD on Monday made an intraday low of US$1.1014/EUR, a high of US$1.1049/EUR, and settled the day down by 0.135% to close at US$1.1018/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 1.1100-1.1400, targeting 1.1060-1.1020-1.0960 and 1.0850- 1.0785 with stop-loss at daily closing above 1.1100. Buy above 1.1060-1.0785 with risk below 1.0700 targeting 1.1100-1.1190-1.1250 and 1.1290-1.1340-1.1400.

GBP/USD

GBP/USD on Tuesday made an intra‐day low of US$1.3048/GBP, a high of US$1.3107/GBP, and settled the day up by 0.489% to close at US$1.3079/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 1.3060-1.2600 with a target of 1.3200-1.3310 and 1.3390-1.3450 with a stop loss closing below 1.2600. Sell in between 1.3100-1.3410 with targets at 1.3150-1.3100-1.3040 and 1.2950-1.2890-1.2790 with a stop loss of 1.3100.

USD/JPY

USD/JPY on Tuesday made an intra‐day low of JPY142.19/USD an intraday high of 143.70/USD, and settled the day down by 0.482% at JPY152.37/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 144.0-150.00 with risk above 150.00 targeting 143.60-143.00 and 142.50-141.90-141.00. Long positions above 143.60-141.00 with targets of 144.20-144.60-145.45 and 146.00-146.90-147.50-148.00 with sto42ps below 146.00.