Monday June 24, 2013 - 03:36:07 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 24-Jun-2013 -0334 GMT
The Dow (14799.40, +0.28%, +41.08) managed a slight uptick on Friday but may still fall towards 14500. Expect selling to resume. The DAX (7789.24) had seen a sharp fall on Friday and may test 7700-7650 today, which is a crucial Support.
All of Asia-Pac is in the red today, ranging from -2.11% (Shanghai China, 2029) to -0.02% (Nikkei, 13227). Only Indonesia and New Zealand are slightly higher. Fresh weakness in the Yen can help the Nikkei rise a bit.
The Nifty (5667.65) had managed to remain above the crucial 5650 Support on Friday. It might surprise/ gratify with a bounce/ upmove today as well. In many instances, India tends to be a leading indicator for global Equities. Let's see what it says today.
There is some chance that the adjustment to the "taper" could ease off this week. Let's see. It might not be good to sell Equities at these levels.
Gold (1290.47) bounced a bit from levels just below 1275 on Friday. While the overall trend remains bearish, a small uptick towards 1325 could be seen before the decline resumes. Silver (19.89) also remains bearish targeting 18, but could see a small bounce today.
Brent (100.58) has fallen to our 101.00-100.50 target region. It has a crucial long-term Support at 100 now. We would not bet on it breaking immediately or at all. Some major news will now be needed to break this Support. But, if it happens it would mark a tectonic shift in the Oil market. Watch carefully. Please take a look at
The Euro (1.3090) continues to fall and should target 1.3050-2975 this week before bouncing back. Max downside should be near 1.2900. Good for range traders. The Dollar Index (82.66) may try to move back up towards range-resistance near 84.00.
Dollar-Yen (98.59) looks like it wants to test 100 again. Might well happen this week. The Pound (1.5373) is in a steep decline. It has crucial Supports near current levels but is in danger of falling towards 1.5300 or even lower if the Support breaks.
The Aussie (0.9195) is close to again testing 0.9175 the 38.2% retracement of the rise from 0.6007 (2008) to 1.1080 (2011). The charts remain bearish though and a further decliine to 0.9000 cannot be ruled out. Eyes should be on Chinese growth prospects.
The R-currencies continue to look weak. The USD-MYR (3.2165) has broken past a crucial range resistance near 3.20 which does not inspire any confidence in the Ringgitt. The Rupee (59.27) remains an easy prey, of course, especially if the RBI steps back a bit. The near-term charts are Oversold and as such Dollar-Rupee could get bought back again while above 58.75.
The US 10-Yr (2.57%) has surged higher and should test the crucial Resistance near 2.70% this week. This Resistance needs to hold and the yield needs to fall back to cool off the markets. Else, there could be serious trouble all round. The last line in the sand would be near 2.95%. Take a look at
No major data release today.
CA Inflation Y/Y
...Actual 0.70 % ...Previous 0.40 %
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