Baht Closes Above Neutral Levels, King Opens Parliament

Spot USD/THB dropped in the first trading session of 2H2023 but fell short of testing its 200-DMA, with all eyes on Thailand's political situation. The rate closed at 35.228, down 0.64% on the day. A break below the 200-DMA, which supported price action on Jun 26/27, would encourage bears to seek a deeper sell-off towards the 34.5 area. For now, the latest pullback from cyclical highs has allowed the rate to unwind its overbought condition, with the RSI returning below the 70 threshold.

• The SET Index closed 0.25% higher on the day, but struggled to make much headway on top of its opening gains. The recent rebound should be considered corrective at this point, with the index operating 9.7% lower on the year.
• The King inaugurated parliament, setting the scene for the House Speaker vote, which is expected to take place tomorrow. The Pheu Thai party proposed a compromise candidate and some reports suggested that election front-runner MFP might accept the offer, which would put an end to their prolonged dispute. Nothing has been made official yet, with the two parties set to hold a presser this evening.