Fresh from the Trading Room: To the east and to the farms
The opinions expressed in this report are those of Inspirante Trading Solutions Pte Ltd (“ITS”) and are considered market commentary. They are not intended to act as investment recommendations. Full disclaimers are available at the end of this report.
Executive Summary
While the U.S. equity market presents a challenging picture with overheated tech stocks and volatility on the horizon, Inspirante Trading Solutions explores promising opportunities in Japan and the commodities market for risk-reward balance.
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Upcoming economic events (Singapore Local Time):
The focus in the next two weeks will be on the U.S. inflation numbers and payroll data.
Markets in focus
Figure 1: USD-Denominated TOPIX Index Futures
The TOPIX index has broken out from a three-month ascending triangle, initiating the next upward leg.
Figure 2: Yield Differential between the U.S. and Japan vs. USDJPY
The Japanese yen continues to weaken against the U.S. dollar, despite a recent narrowing of the yield differentials between the U.S. and Japan, a divergence that only recently emerged.
Figure 3: AUD/JPY (Monthly)
With the weakening of the Japanese yYen against major currencies, AUD/JPY is at the upper resistance of a multi-decade channel, increasing the likelihood of a pullback.
Figure 4: Live Cattle Futures (Dec 2024)
