Friday March 22, 2013 - 03:34:52 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 22-Mar-2013 -0333 GMT
The Dow (14421.49, -90.24, -0.62%) runs into slight profit-taking, Cyprus being cited as the reason. But, the charts are not too worrying. There is good Support at 14250 as we've been saying for the last few days.
The Asian markets are a little, but not too worried about Cyprus, which has been given time till Monday by the ECB to accept the EU bailout. The indiced range between -1.50% (Nikkei, Japan) and +0.16% (Australia). The Shanghai (2322) is holding onto gain seen earlier in the week when it bounced from its 21-week MA. The Nikkei (12446.68) could see some a1.8% profit-taking towards 12200 next week, before possibly rising again.
The Nifty (5658.75) had closed well below 5700-5690 yesterday. It is in a precarious position with dangers of a further decline towards 5600-5500. Today's price action is going to be important.
Gold (1613.57) continues to move up threatening to rise towards 1625. To our mind, Russians would rather buy Gold than keep cash in Cyprus.
The Gold/ Crude ratio is rising in favour of Gold.
Brent (107.57) fell sharply yesterday and can decline further towards 103, as we've been suggesting for some time.The Brent-WTI Spread (14) has broken below 16 and may fall further towards 12.
The Euro (1.2920) is managing to remain above 1.2900, but the danger of a fall towards 1.28 and 1.27 is still very much there for next week while the market remains below 1.3000. The German PMI was weak yesterday. The market will watch the IFO today, which has been rising for the last few months.
Dollar-Yen (94.94) dropped yesterday, but has good Support at 94.00, which should hold. The Euro-Yen (122.59) fell again yesterday, pulled down by the fall in USDJPY. It is trading at a crucial Moving Average Support on the Daily and Weekly charts. This needs to hold strongly for the Eur0-Dollar to bounce. But, the possible weakness in the Euro suggests the Cross could decline also.
The Pound (1.5182) moved up well yesterday and can test 1.53 today in line with suggestions over the last couple of days. Good Resistance is seen there, however. The Aussie (1.0423) rose well yesterday, seeing a high near 1.0459. It is in an uptrend targeting 1.05.
Dollar-Rupee (54.2850) surprised by remaining ranged yesterday. Resistance at 54.50-60-70 may be tested, but may hold on first testing. Let's see how things go today.
The US 10-Yr (1.91%) is relatively steady. The longer term uptrend remains intact. Within that, a dip to 1.75 is a possibility. The 30-Yr (3.14%) can fall towards 3.0%. US Bonds could gain on "safe haven" demand next week if the Euro falls towards 1.28-27.
8:00 or 13:30 GER IFO Business Climate
...Expected 107.80 ...Previous 107.40
8:00 or 13:30 GER IFO Business Situations
...Expected 110.40 ...Previous 110.20
8:00 or 13:30 GER IFO Business Expectations
...Expected 105.00 ...Previous 107.40
US Philifed Index
...Actual 2.00 ...Previous -12.50
US Existing Home Sales
...Actual 4980 K ...Previous 4940 K
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