Friday June 14, 2013 - 04:14:35 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 14-Jun-2013 -0411 GMT
Good rise in the Dow (15176.08, +180.85, +1.21%) yesterday despite a solidly good US Retail Sales number (+0.67 M/m against expectation of +0.4%). The Support near 14995 mentioned yesterday has held well. But, the Dow could still be vulnerable to a fall later on, unless it manages to rise past 15300-500.
All of Asia-Pacific is up today, ranging between +0.11% (China) and +2.89% (Japan, Nikkei 12803). The Oversold conditions in the Nikkei has helped the good bounce. We might see 13200 in a couple of weeks before a fresh fall towards 11750 starts.
The Nifty (5699.10) could see a good rally today, quite likely at the Open itself. In any case, there is good Support in the 5630 region.
That stocks have rallied despite good US data (which might actually signal Fed "tapering") suggests big position adjustments among investors worldwide. But, there is danger of the Dow correcting further that needs to be borne in mind.
Gold (1384) remains quiet within our predicted range of 1365-1425. It can find Resistance near 1411 within that. Silver (21.75) remains precariously poised, threatening to fall towards 20. A bounce (if any) should be limited to 24.25. The Gold-Silver Ratio (63.57) continues to look bullish targeting 65 in the coming weeks.
Brent (104.79) has moved up yesterday. We now expect a sideways range of 100-106 for some days. Given that the Gold/ WTI ratio (14.5) continues to be in a decline, Crude is likely to remain ranged/ strong.
Decent bounce in Dollar-Yen (94.88) today from a low near 93.79, just below the target Support of 94 we've been mentioning for a couple of days. Maybe the market will stabilise for a few days now after the sharp fall over the last 4 weeks. Medium term Support seen at 93.00.
The Euro (1.3355) saw a high 1.3390 yesterday. But we see good chances of profit-taking towards 1.3265. The Euro-Yen (126.75) is trading at the 21-week MA. There could be some rally from here, prompted by a bounce in Dollar-Yen.
The Pound (1.5701) continues to surprise by holding onto gains, trading near the 200-day MA. As mentioned yesterday, there can be chances of seeing 1.5800, while above 1.5650. The EURGBP (0.8502) has dipped a bit, lending strength to the Pound.
The Aussie (0.9589) has seen a solid short-covering rally yesteday, but is finding Resistance at 21-day MA (0.9615) now. It may range between 0.96-93 for a few days, finding buying interest on dips on further Short-covering.
Dollar-Rupee (57.99) closed below 58.00 yesterday and could dip towards 57.70 and maybe even 57.40, given the rise in Equities and the dip in the US 10-Yr Yield to 2.15%.
The US 10-Yr Yield (2.15%) has come off a bit, holding below the crucial 2.20-2.25% Resistance. This dip is despite the solid rise in US Retail Sales yesterday. It suggests the market is likely to be consolidative now ahead of the FOMC announcement on 19th June (next week) at least. Should be supportive of most markets for the next few days.
5:30 GMT or 11:00 IST IN WPI
...Previous 4.89 %
9:00 GMT or 14:30 IST EU CPI (YoY)
...Expected 1.20 % ...Previous 1.20 %
12:30 GMT or 18:00 IST US PPI ex Food & Energy (MoM)
...Expected 0.10 % ...Previous 0.11 %
12:30 GMT or 18:00 IST US Current Account Balance
...Expected -111.00 $ Bln ...Previous -110.40 $ Bln
13:00 GMT or 18:30 IST US TICS (Net foreign purch of long-term Sec)
...Previous - -13.53 $ Bln
13:15 GMT or 18:45 IST US Industrial Production
...Expected 0.30 % ...Previous -0.60 %
13:15 GMT or 18:45 IST US Capacity Utilization
...Expected 77.90 % ...Previous77.80 %
Australia Labour Force
...Actual 1.06 K ...Previous 45.02 K
US Retail Sales
...Actual 0.67 % ...Previous 0.03 %
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