Monday May 3, 2010 - 03:48:52 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 03-May-2010 - 0346 GMT
The US Equities were down last week. The Dow (11008.61) was down 1.75% and the Nasdaq (2461.19) was down 2.73%. The Dow is at a very important trendline Resistance on the Weekly charts (11100-200) which has been honoured for the past six weeks and we need to see which way it finally breaks to decide the way forward. To see the trendline Resistance on the weekly charts click on the following link:
All Asians are down today. The Hang Seng (20828.68) is down 1.33%. Japan is closed on account of Constitution day and China is closed on account of May Day (May 1 - May 3) today. In India, the Sensex (17558.71) was down 0.77% and the Nifty (5278.00) was down 0.49% last week. The Sensex is just above the an important Support at 17500 and a weekly break below 17500 may pull it towards 16500 in the coming weeks.
In Australia, the All Ordinaries (4804.70) is down 0.60% today.
Crude (86.33) is continuing to trade strong. Resistance is seen at 87, a break above which might take it further up towards 90. While 87 holds, we might see a pull back to 85-84 in the coming days. To see the Crude graph click on the following link:
Gold (1178.30) has risen sharply on Friday from the low of 1167.80 and is now trading near the Resistance region 1180-85. A strong break above 1185 might see further rise to 1200-25. While below 1180, there are chances of a fall to 1160-50 in the coming days. To see the Gold graph click on the following link:
The Euro (1.3225) has dipped further despite the $146 bln Greece bailout. Dollar-Swiss (1.0830) too has moved up in sympathy with the fall in the Euro. See danger of further decline towards 1.31-30 this week, as the market believes the real problems (indebtedness and low growth ) are nowhere near being solved and Portugal and Spain are still out there.
Japan is closed from today till Wednesday. Dollar-Yen trades quiet near 93.90. See a range of 93.50-94.50 for the greater part of the week. The UK is also closed today and the Pound trades quiet near 1.5270. Election are due on 06-May and results might be due by the end of the week.
In Asia-Pacific (ex-Japan), the Aussie (0.9248) is trading in the middle of a possible range of 0.9220-70. Good Support is available at 0.9200. The Korean Won (1116.20) has weakened in response to yet anotheer hike in reserve requirements in China, by 50bp this time. The Sing Dollar (1.3722) has also weakened for the second day, with the USD-SGD rising from Friday's low near 1.3645 to a high near 1.3744 today. Expect Dollar-Rupee, which had closed at 44.3550 on Friday, to open higher in response to weakness in the Asian currencies and Equities.
The 3M USD LIBOR was up 1 bps to be set at 0.35%. The 2Y and 10Y yields were down 5 bps and 6 bps each to quote at 0.96% and 3.66% respectively.
China has increased the reserve requirements by 50 bps. This is the third increase this year.
The RBA meet is scheduled for tomorrow (04-May-10) and the BOE and ECB are scheduled to meet on Thursday (06-May-10).
12:30 GMT US Pers.Inc
...Expected 0.4%...Previous 0.0%
12:30 GMT US PCE
...Expected 0.0%...Previous 0.0%
14:00 GMT US ISM
...Expected 60...Previous 59.6
...Actual 5.0% ...Previous 4.9%
...Actual 10.0%...Previous 10.0%
...Actual 0.3%...Previous 0.6%
US GDP Q1 '10 (Adv)
...Actual 3.2%...Previous 5.6%
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