Monday September 27, 2010 - 03:40:46 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 27-Sep-2010 - 0337 GMT
The US equities surged after the monthly US Core Durable Goods Orders registered a 2% increase for August, last Friday. The Dow (10860.26) was up 2.38% and the S&P 500 (1148.67) was up 1.96% last week. The Dow may move up towards 11000-100 this week.
Greenery all around Asia today. The Nikkei (9606.25, up 1.42%) went up led by exporters and possible BOJ intervention. The Shanghai (2603.43, up 0.46%) is trading higher led by exporters and commodity producers over a 4.1% increase US Capital Equipment orders for August. In India, the Sensex (20045.18, up 3.08%) and the Nifty (6018.30, up 2.26%) rallied over strong inflows and positive global sentiments last week. The Sensex may rise towards 21000 in a couple of weeks.
Crude (76.58) has risen sharply and is now trading higher above 76. Weaker Dollar, strong equity markets and economic recovery concerns supported the price rise on Friday. While above 76 there are good chances of further rise towards 78-79 in the coming days.
Gold (1294.80) is continuing to trade higher and is retaining its strength. The broader bullish sentiment remains intact and a strong break above the psychological Resistance at 1300 might take it further up towards 1320-50 in the coming days/weeks. Support is seen in 1280-75 region. To see the Gold graph click on the following link:
Relatively quiet start to the week today after the fireworks last week. The Euro (1.3466) is taking some rest before climbing further towards 1.3590. Dollar-Yen (84.20) had fallen back on Friday itself from an intra-day high near 85.39. Further fall towards 83.50 possible.
Dollar-Swiss (0.9855) has been seeing mild short-covering after hitting a low of 0.9779 on Friday. Immediate Support seen at 0.9805. Expect sideways consolidation before further fall. The Pound (1.5820) is pausing before a further rise towards 1.5910.
The Aussie (0.9581) is trading at a crucial juncture. There is a very important Resistance at 0.9615-35. It also has an important Support at 0.9550-00. Both are to be watched carefully. Further rise in the Aussie over the medium term will be severe indictment of the US Dollar and will lead to/ be led by a surge in commodity prices.
Among the Asians, the ADXY (114) broke above a very long-term trend resistance at 113.25-35 last week and is now likely to rise further towards 115. The Sing Dollar (1.3220) continues to trade strong, as does the Korean Won (1150). The Yuan trades near 6.6940. Dollar-Rupee had closed at 45.25 on Friday. It has a "last" Support at 45.20, which is under fire.
The 3M USD LIBOR was unchanged at 0.29%. The 2Y yields and the 10Y yields quoted at 0.42% and 2.60% respectively.
No major data release today
July GER IFO Business Expectations
...Actual 103.9...Previous 105.2
July GER IFO Business Situations
...Actual 109.7...Previous 108.2
July GER IFO Business Climate
...Actual 106.8...Previous 106.7
July US Durable Goods Orders
...Actual -1.3%...Previous 0.4%
July US New Home Sales
...Actual 288K...Previous 288K
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