Thursday January 24, 2013 - 03:36:54 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 24-Jan-2013 -0334 GMT
Dow Jones (13779.33, +0.49%) gained further yesterday and can rise further to 14000+ levels in the coming days. The index has been rising slowly but steadily from the past few days.
A-Pac is mostly in the green with Australia (4830.70, +0.39%), Hang Seng (23679.69, +0.19%) and Taiwan (7709.98, -0.44%)
Shanghai (2354.84, +1.46%) has risen strongly as the Manufacturing PMI for Jan-13 stood at 51.9 which is the highest levels since Jan-11. We need to see if Shanghai sustains the break of 2350 or not. A strong close above 2350 levels today will make it very bullish.
Nikkei (10524.50, +0.36%) is slightly higher after yesterday’s sharp correction. 10300 has to be watched on the down side which will decide if it bounces from there or dips further to 9800. We will have to wait and watch.
Nifty (6054.30, +0.10%) dipped intraday but then bounced to close flat. If Sensex (20026, +0.23%) breaks 19970 levels, then it can dip to 19800. It is looking more likely to dip to this level which will take Nifty also lower towards 5950. A slightly deeper correction also cannot be ruled out. Picture is a bit mixed but slightly more on the corrective side.
Nymex has dipped a bit but has support near 94.00 while Breant is flat, Gold is ranged, Silver has dipped but can find support and Copper is flat and needs a strong break for further rise.
Nymex Crude (95.49, +0.27%) dipped sharply yesterday though the medium term trend remains positive. A dip to 94.00 before rising further cannot be ruled out.
Brent (112.67, -0.12%) is trading in the upward trending channel on the daily charts and the resistance seems to have moved slightly higher and it now needs to break 114-15 levels to see a strong rise to higher levels.
Gold (1683.50, -0.19%) continues to trade in the 1625-1700 range and is just dipping from the upper end of the range.
Silver (32.09, -1.08%) has dipped today but is likely to get bought between 32-31 for rise towards 33.50-34.00 in the coming days.
Copper (3.68, +0.03%) is flat and need to break 3.73-75 levels to see a further rise towards 3.90-4.00 levels.
Market remains calm and ranged. This sideways consolidation could continue for some more time before the markets takes a specific direction. The Dollar-Index (79.96) is not gaining strength to rise past its 80.10-20 Resistance region and is ranged between 79.50 and 80.20 over the last few days.
The Euro (1.3321) retains its 1.3250-3400 with an overall bullish bias for a rise to 1.3500-50. But a dip to 1.3200-100 before this rise cannot be ruled out. Dollar-Yen (88.90) has risen back well from near 88, but will need a strong break above 89 to rise further towards 90 again. We expect the Dollar-Yen to consolidate between 88 and 90 for some time before we see any further rise. The Euro-Yen Cross (118.40) has found Support near 117 and can rise back towards 120 again.
Dollar-Swiss (0.9295) is mixed and can be ranged between 0.9270 and 0.9350 with a bullish bias to see a rise to 0.9400-50 while above 0.9270. The Pound (1.5841) remains lower in 1.5800-5900 range and remains weak for a further dip to 1.5750-00. Aussie (1.0540) is retaining its 1.0500-600 sideways range.
In Asia, the USD-SGD (1.2266) remains flat in its 1.2200-2300 range. Dollar-Rupee (53.67/68) remains lower below 54 in a range of 53.35-53.90 over the last couple of days and can rise to 54.00-20 if a strong break above 53.80-90 Resistance region is seen.
The Spainish 10Yr yield has come down 5bps to 5.07%. Important to note is that the yield is turning around from its 5.10%-5.15% Resistance region thereby reducing the chances of an immediate rise to 5.40%-5.50%. A break below 5% if seen can take the yield down again to 4.90%-4.80%. The Spain-German Yield spread is not moving higher above 3.50% sharply and can come down to 3.25% once again. 3.75% is expected to be a cap on the upside for the yield spread.
The US yield has come down a bit by 2bps to 1.82%, but looks good for a rise to 2.00%-2.20%.
9:00 GMT or 15:30 IST EU EA (17) Curr Acct Bal
...Expected EUR 26.1 bln ...Previous EUR 26.1 bln
...Actual 0.2% ...Previous 1.4%
UK BOE Minutes
...Actual 0-0-9 ...Previous 0-0-9
...Actual 7.7% ...Previous 7.8%
...Actual 1.0% ...Previous 1.0%
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