Thursday October 15, 2009 - 03:38:15 GMT
Share This Story
FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 15-Oct-2009 - 0335 GMT
The Dow (10015.86) closed above 10000 for 1st time in over a year. 10000 was seen as a huge psychological barrier to cross. It rose 1.47% on Intel's earnings forecast and better than expected retail sales numbers. The equity markets continue to perform well despite concerns over rising unemployment, weak consumer spending and slump in housing market which suggests there's an overall confidence in the market that the economic recovery is not too far off.
The Asian stocks have surged on US cues and general euphoria over the Dow closing above 10000 after a year. Nikkei (10272.62) is up 2.11%, Shanghai (2989.35) is up 0.63% and Hang Seng is up 1.53%. The Sensex (17231.11) rose over 1% yesterday and may continue with the uptrend today as well on global cues. There's Resistance near 17400 which is likely to be tested.
Crude (75.85) closed above 75 for the first time in a year yesterday. The weaker dollar, strong global equities and the optimism about the global economic recovery that would lead to a higher energy demand is keeping the Commodity strong. Technically speaking, Curde is now trading near the significant Resistances at 76 and 76.78 [the 38.2% retracement level of the fall from 141.27 (11-Jul-08) to 33.22 (15-Jan-09) mentioned earlier]. We might expect a pull back from these Resistance levels. However, the overall outlook remains bullish and we might see a rise towards 85-90 in the coming weeks/months. The US Crude inventory data is due today.
Gold (1064.40) has fallen from yesterday's high of 1072. Though the dollar continued to weaken, significant rise in the Commodity was not seen yesterday which is showing a divergence. However, the broad picture continues to remain bullish for a target of 1150-1200 over the next few weeks with strong Support in the region 1060-1040.
Everybody seems to be getting onto the Sell-Dollar trade now, which has some more room to go. Star performer Aussie (0.9214) has room to move up to 0.95. The Euro (1.4955) is breaking earlier resistance at 1.4925 and is within kissing distance of the big figure of 1.50. Dollar-Swiss (1.0130) has fallen below the previous low of 1.0185 and should be on its way to test "Parity" either this week or the next.
The fall in Dollar-Yen (89.40) has slowed down over the last couple of days, the pair having seen a good bounce from 88.82 yesterday. The overall downtrend remains intact, though. The Euro-Yen Cross (133.65) has been moving up over the last few days and is testing an important Resistance at 133.90. Break thereof could be very bullish.
Surprising, but the weakness in the Dollar seems to be so deep-rooted now that the Pound (1.6053) has also risen over the last 3 days, from a low of 1.5710 on Tuesday.
The Asian currencies have strengthened quite a bit. The Sing Dollar trades near 1.3860 and the Korean won near 1158.40. Dollar-Rupee had closed lower near 46.13 yesterday and is likely to fall below 46.00 today. The 1-mth NDF trades near 45.88.
3M USD LIBOR was left unchanged at 0.28%. The yields on US Treasuries rose between 5-8 bps for longer term maturities. The 10Y yields shot up 8 bps to 3.42% and the 30Y bond yields were quoted at 4.28% up 8 bps.
09:00 GMT EU Sep CPI (YoY)
...Expected 1.2%...Previous 1.3%
12:30 GMT US Sep Core CPI (MoM)
...Expected 0.1%...Previous 0.1%
14:00 GMT Aug US Philifed Index
......Expected 12.4...Previous 14.1
...Actual 0.10%...Previous 0.10%
EU Sep IND Prodn (MoM)
...Actual 0.9%...Previous 0.2%
US Sep Retail Sales
...Actual -1.5%...Previous 2.2%
Forex Trading News
Daily Forex Market News
Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."