Friday January 18, 2013 - 03:38:27 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 18-Jan-2013 -0336 GMT
Dow Jones (13596.02, +0.63%) saw a good rise inside its 13550-750 resistance region. It continues to looks strong/resilient, a break above 13750 will make it further bullish. Housing starts numbers stood at 0.954Mln against expected of 0.890Mln which also lent support to the index.
A-Pac is mostly in the Green taking cues from the US markets. Australia (4794, +0.32%), Hang Seng (23472, +0.57%) and Taiwan (7689, +0.95%).
Shanghai (2294.42, +0.42%) is up as the GDP numbers came better than expected at 7.9% against 7.8% expectations. This rise is welcome but a break of 2325-50 will have to be seen for further up move. Chances of seeing a correction still cannot be ruled out.
Nikkei (10837.88, +2.15%) has bounced from its 10600 support as it continues to remain positive and refuses to budge. BOJ is scheduled next week and the expectations are for a further stimulus. It has some resistance near 11200-300 which can be tested in the coming days. Tough to say when a meaningful correction will be seen.
Nifty (6039.20, +0.62%) climbed further also helped by the positive news of the partial Deregulation of Diesel prices. Index needs to see a strong break above 6075 to rise towards 6250-300. On the down side a break of 5975-50 will push it lower towards 5925-5875.
Nymex has broken on the upside but Brent has not, Gold continues to be ranged while Silver is above the range and can rise if sustains. Copper has held 3.60, eyes on 3.70.
Nymex Crude (95.19, -0.31%) has finally seen a break of 95.00 on daily closing basis. It can rise towards 103.00 in the coming days.
Brent (110.93, -0.15%) has also risen with Nymex but continues to remain below 112-13 which has to be broken for it to rise in sync with Nymex towards 116-18.
Gold (1688.70, -0.12%) continues to trade in its 1700-1625 range. As mentioned yesterday we need to watch if it breaks 1700 on the upside.
Silver (31.77, -0.13%) is slightly above its 29.75-31.75 trading range and if sustains over this level can then strengthen further towards 34.00 in the coming days.
Copper (3.65, -0.10%) has risen as it has held its 3.60 support. Strong resistance is seen near 3.70-73 and a bullish move can only develop on a strong brake of this resistance. Yesterdays rise has been quite strong and in the immediate term 3.70 can be seen.
Market remains mixed and diversed. Yen and the Swiss are trading weak while the Euro and the Aussie looks ranged. The Pound is mixed and is a bit weak in the immediate term. The Dollar-Index (79.71) is finding Resistance near 79.90 and could turn around to dip to 79.30-00 in the coming days. 80.00-10 is an important Resistance region which can restrict any sharp rise in the index.
The Euro (1.3369) has risen well breaking above its 1.3330 Resistance. With immdeiate Support near 1.3350, we see good chances of a break and rise above 1.3400 towards 1.3500-600. Dollar-Yen (89.82) has risen back strongly above 89 and remains bullish for a test of 92.00-20. The Euro-Yen Cross (120.09) remains strong and can rise further to 121.50-122 in the coming sessions.
Dollar-Swiss (0.9364) is not breaking below 0.9300 and has very good chances to rise towards 0.9400-30. The Pound (1.5976) looks weak in the immediate term for a dip to 1.5950-00, but can see a sharp bounce from 1.5900 levels which can take it back to 1.6100-6200. Aussie (1.0516) is still retaining its 1.0500-600 range but the immediate bias is slightly bearish to see a break and dip below 1.0500 towards 1.0450.
In Asia, the USD-SGD (1.2252) is continuing to trade flat in a narrow range of 1.2215-75. Dollar-Rupee (54.39/40) had closed lower and can dip further to test 54.20-15, a break below which can trigger further fall.
The Spanish 10Yr yield has risen 10bps to 5.13% and is just below its important 5.15%-5.20% Resistance region. A break above 5.20% will open doors for further rise to 5.50%. The Spain-German Yield spread has moved up by 6bps and can move up further towards 3.75%. This is something to be watched and this expected rise in the spread could keep the upside capped at 1.3400 for the Euro for some more time.
The US 10Yr treasury yield has risen back by 6bps to 1.88% and is keeping alive the chances if seeing a rise to 1.20%-1.22%. As mentioned yesterday, only a break below the immediate Support at 1.80% will reduce the chances of seeing a rise.
No major data release today.
Australia Labour Force
...Actual -5.5 K ...Previous 17.13 K
US Housing Starts
...Actual 0.954 Mln ...Previous 0.851 Mln
US Philifed Index
...Actual -5.8 ...Previous 8.1
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