Thursday October 1, 2009 - 03:37:18 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 01-Oct-2009 - 0334 GMT
The Dow (9712.28) and the Nasdaq (2122.42) fell 0.31% and 0.08% respectively. The Dow has important Support near 9250. Till this Support holds, the trend remains bullish in the medium term. US Q2 Final GDP numbers came in better than expectations at -0.7% as against an expectation of -1.2%.
The Asian indices are trading mixed. Nikkei (9990.03) is trading lower by 1.41% despite Tankan Manufacturer's index showing signs of recovery. It climbed to -33 as against -48 in June and street expectations of -32. However, concerns that Japanese companies might plan to cut investments in response to slump in profits caused stocks to fall. The markets also fear a decrease in demand following the exhaustion of stimulus packages announced by governments the world over. Nikkei has fallen sharply over the last 5-6 trading days and has Support next at 9800. Shanghai and Hang Seng are closed today while Jakarta, Taiwan and NZSE are trading higher by nearly half a percentage each.
The Sensex (17126.84) has broken the channel Resistance at 17050 yesterday and is looking to scale further up towards 20000 over the next few months.
Crude (70.00) has risen sharply yesterday following the US government's weekly oil data that showed a drop of 1.6 million barrels in the gasoline inventories. However the US Crude inventories increased by 2.8 million barrels as expected. Immediate Support-turned-Resistance Trendline is seen at 70.50. A strong break above this Resistance might see a rise once again towards 72.50-73.00. On the other hand a break below 70 might pull it down towards 67.50. To see the Trendline Resistance on the Crude graph click on the following link:
Gold (1006.80) has risen sharply yesterday from the low of 992.50 and is now trading above 1000. Immediate Resistance is seen at 1010, a break above which might see a rise towards 1020. If 1010 holds, a break below 1000 might pull it down once again towards 990-985.
Currencies like the Euro (1.4635) and the Aussie (0.8825) retain their overall strength and are consolidating. The overall environment is still positive although the Aussie could see some profit-taking here. Dollar-Yen (89.85) is also consolidating between 89.50-90.20 within an overall downtrend. The Euro-Yen Cross (131.50) too may remain consolidative between 131-132 for a couple of days.
The Pound (1.5965) has fallen again after having seen a corrective rally to 1.6125 yesterday. This could be a decent "Sell" candidate today. Dollar-Swiss (1.0365) remains bearish despite a rally to 1.0450 yesterday. It is to be seen, however, whether Traders are keen to press fresh sales onto the pair.
In Asia, the Sing Dollar (1.4105) had strengthened again yesterday and the USD-SGD has hit a fresh low for the year at 1.4061 today. The Korean Won trades strong near 1178. Dollar-Rupee was closed yesterday but may be expected to move down today given the strong rise in India Equities yesterday. The NDFs are quoting near 47.80, much lower than Tuesday's Close near 48.10/11.
3M USD LIBOR was left unchanged at 0.29%. The yields on US Treasuries were little changed. The 10Y benchmark yields continue to trade near 3.30%. The 2Y yields was quoted 4 bps lower near 0.95%.
JP Tankan Large Manufacturers Index
...Actual -33...Previous -48
09:00 GMT EU Unemp
...Expected 9.6%...Previous 9.5%
12:30 GMT US July Personal Income
...Expected 0.1%...Previous 0.0%
12:30 GMT US July PCE Price Index M/M
...Expected 1.2%...Previous 0.2%
14:00 GMT Sep US Manufacturing ISM
...Expected 53.9...Previous 52.9
US GDP Q2 '09 (Fnl)
...Actual -0.7%...Previous -1.0%
...Actual 0.0%...Previous 0.1%
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