Thursday July 1, 2010 - 03:41:38 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 01-Jul-2010 - 0349 GMT
The US Equitis fell in the last trading hour of the session yesterday. The Dow (9774.02) was down 0.98% and the S&P 500 (1030.71) was down 1.01%. The Dow has chances of falling further towards 9500 in the coming days.
All Asians are in the Red today except the Shanghai (2403.29, up 0.21%). The Nikkei (9200.42, down 1.94%) may dip towards 9000 in the next few days. In India, the Sensex (17700.90) closed up 0.95% and the Nifty (5312.50) closed up 1.07% yesterday. The Markets may continue to consolidate in the range of 17500-18000 for the next few days.
Bearishness in Crude (74.65) now, with the market coming off well yesterday, after the Resistance at 79-80 held well earlier in the week. Rising signs of fresh economic weakness across the globe are a powerful barrier to a rise in Crude prices. Instead, a further dip towards 73.00-72.50 is possible next week. The immediate reason being put forward for the overning fall is an unexpected rise in US fuel supplies and inventories.
Gold (1240.50) is just about managing to remain above 1240 for the while, but might be vulnerable to profit-taking if the other markets continue to fall. Immediate range is likely to be 1250 on the upside and 1230 on the downside.
China's slow manufacturing growth and the economic recovery concerns are retaining the Risk Aversion in the market. The Dollar, Yen and Swiss Franc are trading strong.
The Euro (1.2220) is ranged between 1.2150-2300 over the last few days within the overall downtrend. Dollar-Yen (88.16) has broken below the Support at 88.50 and might test the next significant Support seen at 87.75-60 region. Swiss (1.0720) is continuing to trade strong and might strengthen further towards 1.0630-00.
The Euro-Yen Cross (107.68) is retaining its downside pressure and might see further dip towards 106-105 in the coming days. Pound (1.4927) has come off sharply from yesterday's high of 1.5074 breaking below 1.50. While below 1.50 we might expect further dip towards 1.4800-4780. Aussie (0.8343) is keeping up its downside momentum. 0.8311 (200-Week-MA) is a significant Support level seen on the downside and a strong break below it might trigger further dip towards 0.81-80.
In Asia, the Korean-Won and the Sing-Dollar are continuing to trade weak. USD-KRW is trading near 1235 and USD-SGD is trading near 1.4002. Dollar-Rupee has closed at 46.44/45 yesterday and has opened higher at 46.74-75 today.
The 3M USD LIBOR was unchanged at 0.53%. The 2Y yield was unchanged at 0.59% while the 10Y yield was down 1 bps to quote at 2.92%.
JP Tankan Large Manufacturers Index
...Actual 1...Previous -14
14:00 GMT May US Manufacturing ISM
...Expected 58.9...Previous 59.7
US ADP Emp
...Actual 13K...Previous 57K
...Actual 0.0%...Previous 0.6%
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