Tuesday September 14, 2010 - 03:48:28 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 14-Sep-2010 - 0345GMT
The US Equities continued their upmove yesterday following 'comfortable' Basel III norms and renewed signs of economic stabalisation. The Dow (10544.13) was up 0.78% and the S&P 500 (1121.90) was up 1.11%. The Dow has immediate Resistance near current levels (10550), a break above which may take it towards 10700-50 in a couple of weeks.
The Asian Equities are mixed today. The Nikkei (9300.65) is down 0.23% over stronger Yen and the Shanghai (2690.15, up 0.07%) may continue to move in the range of 2600-700 for some more days. In India, the Sensex (19208.33, up 2.17%) and the Nifty (5760.00, up 2.13%) were up following better than expected IIP numbers and global strength in equities. The Sensex and Nifty are near Resistance levels and may not see much upside in the coming days.
Crude (77.16) is continuing to trade higher. The extended shutdown of Enbridge pipeline, strong Chinese industrial data are retaining the Crude price higher. The stronger equity markets and weaker dollar also supported the price rise yesterday. Immediate Resistance is seen at 78 and a strong break above it might take it further up towards 80-82 in the coming days. To see the Crude graph click on the following link:
Gold (1248.90) is ranged between 1235-50 over the last couple of days. With lack of upside momentum to see a strong break above 1250-55 Resistance region, the immediate outlook remains slightly bearish for a fall towards 1220. To see the Gold graph click on the following link:
Overnight weakness in the Dollar against most currencies as "risky assets" continue to be bought. But, key Supports for the Dollar and Resistances for the other currencies are getting closer. The Euro (1.2870) has Resistance at 1.2920 and then at 1.3000. Dollar-Yen (83.42) has a strong Support at 83.00 and might be worth buying. Similarly, Dollar-Swiss (1.0074) has a strong Support at 1.0050.
The Aussie (0.9335) rose to 0.9362 in the late US/ early Asian session, but has fallen back a bit from there. Yesterday's high near 0.9362 now becomes a crucial Resistance to watch, as it is key to keeping the Aussie at a sub-Par (below 1.0000) level. The Pound (1.5405) remains ranged between 1.55 and 1.53, unable to decide where to go.
In Asia, the Korean Won (1161.70) is trading strong, below the 200-day Moving Average which is at 1164.50. The Sing Dollar (1.3365) continues to remain under pressure and is trying to break below the 1.3350 Support. The Brazilian Real (1.7105-65) is also trading at its strongest level since January. Dollar-Rupee, which had closed at 46.40 yesterday, might see a slight dip to 46.35 today, before it moves up again, towards 46.50.
The 3M USD LIBOR was unchanged at 0.29%. The 2Y and 10Y yields were down 4 bps and 9 bps to quote at 0.54% and 2.74% respectively.
UK Cons Conf
...Actual 61...Previous 59 56
08:30 GMT July UK CPI Y/Y
...Expected 2.9%...Previous 3.1%
09:00 GMT EU July IND Prodn (MoM)
...Expected 0.2%...Previous -0.1%
12:30 GMT US July Retail Sales
...Expected 0.4%...Previous 0.4%
No major data release yesterday
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