Thursday September 23, 2010 - 03:53:41 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 23-Sep-2010 - 0350 GMT
The US Equities closed down yesterday. The markets have seen a 7.5% surge in September but have been silent in the past few sessions in absence of any significant motivating factor for the investors. The Dow (10739.31) was down 0.20% and the S&P 500 (1134.28) was down 0.48%. The Resistance at 10750-800 has been holding till now and we need to wait and watch whether the markets break above 10800 this week.
The Asian Equities are mixed today. The Nikkei (9566.32, down 0.37%) may weaken further towards 9300-400 over strong Yen in the coming days. The Shanghai (2591.55) is closed till Friday. In India, the Sensex (19941.72) and the Nifty (5991.00) were down 0.30% on mild profit booking yesterday. The Sensex and the Nifty may gain about 5-7% from their current levels on a strong close above 20000 and 6000 in the coming days.
Crude (74.69) is continuing to trade lower, The EIA's report that showed an unexpect rise in the US Crude inventories despite Enbridge pipeline shutdown pulled down the price yesterday. As mentioned earlier, Support is seen in 74-73 region which is holding as of now. The immediate outlook is mixed with the weaker dollar on one side providing Support for an intraday rise everyday and the inventory concerns retaining the downside pressure on the other side. We will have to wait and watch.
Gold (1292.80) is continuing to trade strong and is heading towards 1300 as expected. With Resistance-turned-Support in 1280-75 region, the overall outlook continues to remain bullish for a rise towards 1320-50 in the coming days/weeks. To see the Gold graph click on the following link:
Weakness continues to sap the Dollar. The Dollar Index (79.84) is trading below 80 now, having seen a low of 79.56 today. Further decline looks quite likely in the coming months now.
The Euro (1.3398) saw a high of 1.3440 yesterday and targets 1.3590 in the coming days. Dollar-Yen (84.55) dropped to a low of 84.27 and could dip more unless the BOJ buys again. Possibly, they may wait for a fall to the 83.50 region before coming in to buy.
Dollar-Swiss (0.9870) fell sharply yesterday and may now gun for the Mar-08 low of 0.9635 in the coming weeks. The Pound (1.5665) now has a good Support at 1.5625 and might be emboldened to rise towards 1.57 and 1.58. The Aussie (0.9567) may not be as bullish as the rest, though, with Resistance near 0.9600-35. A fall in Dollar-Yen (if seen) could bring the Aussie lower.
In emerging currencies, two quote systems show that the Dollar-Brazilian Real has crashed to 1.6745. Others say it is trading near 1.7185. The Won is stronger near 1158. The Sing Dollar has gained further to 1.3253. Dollar-Rupee, which had closed at 45.58, might dip today.
The 3M USD LIBOR was unchanged at 0.29%. The 2Y and 10Y yields were up 2 bps each to quote at 0.43% and 2.56% respectively.
July US Existing Home Sales
...Expected 4.11 Mln...Previous 3.83 Mln
UK BOE Minutes
...Actual 1-0-8...Previous 1-0-8
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