Wednesday September 29, 2010 - 03:47:53 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 29-Sep-2010 - 0346 GMT
U.S. stocks finished higher Tuesday as a drop in consumer confidence and a mixed reading on home prices failed to sink recovery hopes. The Dow (10858.14) was up 0.43% and the S&P 500 (1147.70) was up 0.49% yesterday. US markets are on key channel resistance, with Dow facing resistance between 10880-10920.
Asian stock markets were higher in the morning, with Japanese stocks lifted by a better-than-expected business sentiment survey. The Nikkei (9555.27, up 0.63%) is facing resistance at 9700-9750, above which we see 10,500 as next target. The Shanghai (2628.12, up 0.64%) is bouncing from the support of its range of 2600-2700 and is expected to move towards 2700 in the coming sessions.
In India, the Sensex (21,184.54, up 0.37%) and the Nifty (6055.95, up 0.44%) has opened up in the early morning trade today. The Sensex may rise towards 21500 in the coming sessions.
Crude (76.44) is ranged between 75.50-77.20 over the last couple of days. As mentioned earlier, while above 76 there are good chances of further rise towards 78-79 in the coming days.The US Crude inventory data is due today.
Gold (1309.10) has risen breaking above the psychological level of 1300. The weak US consumer confidence data release yesterday triggered the rise. The overall bullish sentiment is intact and as we have been mentioning for some time, we might expect further rise towards 1320-50 in the coming days/weeks.
Futher weakening of the dollar seen all over following the weak US consumer confidence data release yesterday. The Euro (1.3578) has risen sharply and is trading near a very important Resistance in 1.3600-10 region (13-Month, 21-Month and the 55-Week MA). A strong break above this Resistance region might increase the chances of a rise towards 1.3900-4000. Dollar-Yen (83.83) is retaining the downtrend and is now trading below 84. MIght dip further towards. Euro-Yen Cross (113.85) has risen slightly and might rise further towards 115-116 on a break above 114.
Dollar-Swiss (0.9760) is retaining its downtrend and might test the previous low of 0.9635 (Mar-08) in the coming days. The Pound (1.5817) is trading sideways over the last couple of days within its uptrend. A test of 1.5600 is looking likely in the coming days. Aussie (0.9673) is retaining its strength and is continuing with its upmove.
The Asian Currencies are trading strong. The Korean-Won is trading near 1140 and the Sing dollar is trading near 1.3178. Dollar-Rupee has closed at 45.15/16 yesterday and might see a dip below 45 towards 44.85-75, given the weakness in the dollar all over.
The 3M USD LIBOR was unchanged at 0.29%. The 2Y and 10Y yields were down 1 bps and 6 bps each to quote at 0.43% and 2.47% respectively.
JP Tankan Large Manufacturers Index
...Actual 8...Previous 1
09:00 GMT EU Biz Climate
US Case Schiller
...Actual 3.2%...Previous 4.2%
US Cons Conf
...Actual 48.5...Previous 53.2
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