Daily Markets

• The U.S. dollar drifted in a narrow range Wednesday as attention turned towards who U.S. President Donald Trump would choose to fill a vacancy on the Federal Reserve’s Board of Governors. At 03:50 ET (07:50 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.1% lower to 98.527, in subdued activity after the currency registered its largest one-day percentage fall in nearly four months on Friday following the weak jobs report. The greenback has struggled to recover from the slump late last week after the disappointing jobs report, with data on Tuesday showing the U.S. services sector activity unexpectedly flatlined in July even as input costs climbed by the most in nearly three years, underscoring the hit from Trump’s tariffs on the economy. Traders continue to price in around a 90% chance of a Fed cut in September, with about 56 basis points worth of easing expected by the year-end. There’s little in the way of significant economic data due Wednesday, and thus attention is firmly focused on who the U.S. president chooses to replace resigning Fed board member Adriana Kugler, with Trump saying on Tuesday he will decide on a nominee by the end of the week. In Europe, EUR/USD edged higher to 1.1576, even after German industrial orders unexpectedly fell in June, declining for a second straight month, due to falling demand from abroad. Orders were down by 1% on the previous month, much weaker than the expected rise of 1.0%. Eurozone retail sales are expected to rebound 0.4% on a monthly basis in June from the previous month’s drop of 0.7%, with the data due for release later in the session. The U.K.’s central bank is widely expected to cut its key interest rate to 4% from 4.25% on Thursday and to lower it once more before the end of the year, despite consumer price inflation rising to close to double the central bank’s 2% target in June. Elsewhere, USD/JPY traded marginally higher to 147.66, following weaker-than-expected average cash earnings data for June, which pointed to sluggish wage growth, which could in turn herald some cooling in inflation. The Indian currency saw some relief after the Reserve Bank of India (NSE:BOI) left interest rates unchanged at 5.50%, defying some market expectations that it would cut rates further. Expectations for a cut had stemmed from increasing headwinds for the Indian economy, especially from higher U.S. trade tariffs.

Gold – XAU

Gold on Wednesday made its intraday high of US$3385.20/oz and low of $3358.10/oz. Gold is down by 0.029% at US$3368.99/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 3380-3500 keeping stop loss closing above 3500, targeting 3367-3354-3330-3312 and 3300-3288-3278-3267. Buy in between 3367-3211 with risk below 3200 targeting 3380 and 3390-3400-3424-3434

Silver - XAG

Silver on Wednesday its intraday high of US$37.92/oz and low of US$37.59/oz settle up by up by 0.068% at US$37.80/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 37.80-33.10, targeting 38.10-38.90-39.50 and 39.90-40.50-41.10 with stop loss should be placed on the breakage below 33.00. Sell in between 38.50-43.00 with a stop loss above 43.00 targeting 37.80-37.20-36.30 and 35.60-35.30-34.70-34.05.

Oil - WTI

Crude Oil on Wednesday high of US$66.01/bbl, an intraday low of US$63.01/bbl, and settled down by 2.307% to close at US$63.59/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 65.10-72.00 with stop loss at 72.00; targeting 65.40-64.10 and 63.40-62.80-62.00. Buy above 64.20-62.00 with risk daily closing below 62.00, targeting 67.10-67.90-68.70 and 69.50-70.05-71.00.

EUR/USD

EUR/USD on Wednesday an intraday low of US$1.1563/EUR, a high of US$1.1667/EUR, and settled the day up by 0.734% to close at US$1.1658/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 1.1690-1.1990, targeting 1.1545-1.1500-1.1470 and 1.1420-1.1390-1.1320-1.1260 with stop-loss at daily closing above 1.1990. Buy above 1.1645-1.1110 with risk below 1.1100 targeting 1.1690-1.1755-1.1790 and 1.1850-1.1890.

GBP/USD

GBP/USD on Wednesday low of US$1.3280/GBP, a high of US$1.3367/GBP, and settled the day up 0.452% to close at US$1.3351/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 1.3310-1.3040 with a target of 1.3370 and 1.3400-1.3470-1.3510-1.3600 with a stop loss closing below 1.3040. Sell in between 1.3370-1.3850 with targets at 1.3310-1.3200-1.3139 and 1.3090-1.3050-1.3010 with a stop loss of 1.3850.

USD/JPY

USD/JPY on Wednesday an intra‐day low of JPY146.97/USD an intraday high of 147.87/USD, and settled the day down by 0.140% at JPY147.33/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 100DMA (152.35), 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 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 148.10-154.00 with risk above 154.00 targeting 147.40-146.60-146.10 and 145.20-144.70-143.90. Long positions above 147.40-145.00 with targets of 148.10-148.90-149.35 and 149.90-149.00-148.10-147.40 with stops below 145.00.