Thursday May 13, 2010 - 03:49:59 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 13-May-2010 - 0347 GMT
The US Equities were up yesterday. The Dow (10896.91) was up 1.38% and the Nasdaq (2425.02) was up 2.09%. The European uncertainity had pulled the Dow down 5.71% last week, and some "clarity" on Europe has pulled it up 4.98% this week. The markets are very sensitive to any uncertainity and the global economic conditions are too uncertain to give any immediate clarity. During such times, an short-term upmove or a downmove may not be indicative of the future course of the market movement. In the near term we see some Resistance near 11000-100 on the Dow.
Asians are finally all in the Green today. The Nikkei (10549.41, up 1.49%) and the Shanghai (2664.64, up 0.34%) continue to be near very crucial Support levels. To see the Trendline Support on 1) Nikkei and 2) Shanghai, please click on the following link:
The Hang Seng (20394.62) is up 0.90%. In India, the Sensex (17195.81) was up 0.32% and the Nifty (5156.65) was up 0.40% yesterday. We continue to hold our view of a fall towards 16500 on the Sensex in the coming days.
In Australia, the All Ordinaries (4668.30) is up 1.49% today.
Crude (75.60) is continuing to trade lower. The EIA's data release showing higher than expected Crude inventories in US retained the price lower yesterday. As mentioned earlier, 75-74.50 is a very crucial Support region to watch for and a break below it might pull it further down towards 72-70. With lack of upside momentum now, we see slightly a high chance of a down move to 72-70. However, we will have to wait and watch.
Gold (1237.70) is continuing to trade strong and is keeping up its overall bullish sentiment intact for a further rise towards 1250-75 in the coming days. To see the Gold graph click on the following link:
Currencies are consolidating a bit after the huge volatility seen last week and early this week. Within that, the "risk" currencies have gained a bit over yesterday and today.The bigger trend remains Dollar-positive, however.
The Euro (1.2645) remains weak, having come off from yesterday's high near 1.2739, but is trading above Support at 1.2600. Overall trend remains bearish, though. The Pound (1.4855) is expected to be consolidative between 1.4950 on the upside and 1.4750 on the downside for a couple of days. Overall trend bearish. Dollar-Yen (93.15) has been rising slowly from a low near 92.20, over the last couple of days. The market has been quiet and a big move seems to be now in the offing. A rise past 93.50 might be bullish, if seen.
Dollar-Swiss (1.1090) is looking bullish in the near term for a possible rise to 1.1200, maybe even 1.1250. The Aussie (0.8988) has risen a decent bit from yesterday's low near 0.8890 and might rise further towards 0.9040, where it may face stiff resistance.
In Asia, the Korean Won (1131.60) and the Sing Dollar (1.3795) have both strengthened further today. Dollar-Rupee had closed near 45.1150 yesterday. It may dip towards 45.00-44.95 today.
The 3M USD LIBOR reached its highest level in almost nine months and was up 1 bps to be set at 0.43%, as the Euro zone's debt crisis is continuing to keep up the concerns on lending.
The 2Y and 10Y yields were up 3 bps and 5 bps each to quote at 0.86% and 3.57% respectively.
The South African Central Bank meet is scheduled today and is expected to leave the interest rates unchanged at 6.5%.
Apr Australia Labour Force
....Actual 33.7K...Previous 27.7K
08:30 GMT UK Apr Trade Balance
...Expected $ -6.5 Bln...Previous $ -6.2 Bln
...Actual 8.0%...Previous 8.0%
EU Apr IND Prodn (MoM)
...Actual 1.3%...Previous 0.7%
EU GDP Q1'10
...Actual 0.2%...Previous 0.0%
US Apr Trade Balance
...Actual $ -40.4 Bln...Previous $ -39.4 Bln
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