Thursday April 25, 2013 - 03:36:48 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 25-Apr-2013 -0333 GMT
Nikkei (13856.60, +13.17, +0.10%): Has opened slightly higher. It seems that the uptrend since October 2012 has some more upside. 14100-14200 could be the shorter term target for the index. However a minor retracement to 13300-13500 will be very healthy outcome going forward.
Dow Jones (14,676.30, -43.16, -0.29%): traded most part of the day in a narrow range, despite the worse than expected Durable Goods data. The index is very critically poised now with 14600-14650 as the very important short term support zone. Breach below this on a closing basis can take the index down to 14300. Upside look capped at 14830-14900. On a longer time frame we remain bullish.
Dax (7759.03, +100.82, +1.32%): Continued to move up and clocked over 100 points on the second consecutive day. However the supply area of 7800 will likely pose threat to this uptrend. On the downside 7600 is a likely support.
Shanghai (2,203.05, -15.22, -0.69%): Is trading lower and looks likely to trade soft in the next few trading sessions. Upsides look to have stiff resistance around 2225-2235. A very critical buying area on the downside stands at 2165-2175.
Nifty (5836.90,+2.5 pts): The market was closed on account of Mahavir Jayanti yesterday. May see trade volatile on the back of F&O expiry. 5830-5850 is a good support level for the Nifty and upside can face supply around 5920.
Apart from Silver, Commodities have recovered a bit over the last few days, but could resume their downmove soon.
Gold (Spot 1443.90) has moved up further, but has Resistance near current levels now and could dip back towards 1400. Brent (102.18) also trades higher and may test the 103, the upper end of the 103-97 range, but could dip back from there.
Silver (23.37) continues to consolidate sideways and continues to look weak, by itself and against Gold as well. Copper (3.1905) has bounced over the last couple of days, but has a crucial Resistance near current levels now. If it break higher, we could be looking at rise towards 3.25-3.30 in the coming days. This is to be watched today.
The Dollar Index (82.72) has come off a little from yesterday's 83.02. The market is seeing an intense debate whether to take the Index higher past 83.80 or to sell it down again.
Although the Euro (1.3048) has managed to hold above the 200-day Support at 1.2944 over the last couple of days, it could be vulnerable to drop towards 1.28 unless it is able to rise past 1.3090. That the Euro was able to bounce despite a worse than expected Geerman IFO yesterday might give it a bit of hope.
As expected, Dollar-Yen (99.44) is consolidating sideways. It is finding Support above 99.00, reducing the chances of a fall. Still, it needs to break above 100 to attract concerted buying interest. Tomorrow's BOJ Meeting's inflation forecast will be keenly watched. The Euro-Yen Cross (129.75) is looking very bullish with potential to test 132.45.
The Pound (1.5332) has moved up well since yesterday, as the Support at 1.5200 has held well, in line with expectation. Look for 1.54 on the upside now. Dollar-Swiss (0.9450) is trading near a super-crucial long-term Resistance. Whether this holds or breaks is going to decide whether the Swissy weakens towards 0.99 or gains towards 0.93-91 again.
The Aussie (1.0315) has bounced, as suggested yesterday, and could see 1.0340-50 soon. That the Support at 1.02 ha held is encouraging for the Aussie.
The Rupee market opens again today. The Rupee had closed at 54.38 on Tuesday. We expect it to be quiet and ranged between 54.15-50.
The German-US 10-Yr Spread (-0.46%) could dip a bit towards -0.50%. The US-Japan 10-Yr Spread (1.12%) looks like it can bounce well. This suggests the Dollar could strengthen against both the Euro and the Yen. We have to see how this plays out.
The market would be looking forward to the BOJ Meeting tomorrow for further direction the Yen.
5:07 GMT or 10:37 IST BOJ Meeting
...Expected <0.10 % ...Previous <0.10 %
12:30 GMT or 18:00 IST US GDP
...Expected 3.00 % ...Previous 0.38 %
...Actual 0.40 % ...Previous 0.20%
GER IFO Business Climate
...Actual 104.40 ...Previous 106.70
GER IFO Business Situations
...Actual 107.20 ...Previous 109.90
GER IFO Business Expectations
...Actual 101.60 ...Previous 103.60
US Durable Goods Orders
...Actual -5.72 % ...Previous 4.33 %
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