Tuesday July 2, 2013 - 03:37:33 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 02-Jul-2013 -0334 GMT
Mixed moves in Equities globally. Overall positive for now.
The Dow (14974.96, +044%, +65.36) is ranging sideways, a suggested yesterday. We see a range of 14600-15200 for a couple of weeks. If the Dow moves up to 15200 before the NFP on Friday, it may come down after that.
The DAX (7983.92, +24.70, +0.31%) ended higher yesterday after dipping earlier during the day.
Asia-Pac is mixed. Shanghai (1987, -0.44%) is down, while the Nikkei (13958, +0.76%) is up, helped by the weak Yen. The failure of the Shanghai to build on yesterday's gains and rise above 2000 could be a worry. The Nikkei seems to be headed up towards 14200-300.
The Nifty (5898.85) had seen another solid rise yesterday. The momentum is strong and there can be chances of seeing 5950, maybe even 6000. Expect profit-taking there, though.
Good showing in industrial commodities. Suggests good prospects for global growth.
Gold (1255.7) is trading above 1250. Crucial Resistance seen between current levels and 1260. These need to hold for immediate bearishness to remain in force and for Gold to continue to decline towards 1150. Else we may see a rise towards 1300 before the fall resumes. Gold remains bearish overall.
Silver (19.70) continues to look bullish with chances of a rise towards 20-21. We have to see whether bullishness in Silver can pull Gold higher or not.
Brent (103.03) continues to trade relatively positive within its 100-104 range. We are bullish longer term, expecting to see a gradual rise towards 106-108.
Copper (3.1445) has managed to soar past 3.10. This greatly reduces the danger of a fatal decline towards 2.90 and lower. If the momentum persists, we may see Copper move up to 3.30 now. Should Copper rise relative to Gold, that will be a very good sign for global growth.
The Euro (1.3058) has been consolidating sideways for a few days now. The danger of a fall to 1.29 remains. That said, expect a good bounce from there in the longer term. The Pound (1.5210) remains weak with chances of dip towards 1.5090 before a bounce towards 1.55 kicks in.
Dollar-Yen (99.61) continues to look strong, targeting 100+, possibly 100.40-70. The Euro-Yen Cross (130.08) looks bullish for a test of 131.70 at least. That would be largely due to a rise in Dollar-Yen.
Some respite for the Aussie (0.9226) which saw a short-covering rally from lows near 0.9135 yesterday. A test of Resistance near 0.9275 looks possible today. The Aussie absolutely NEEDS to see a short-covering rally in July else it faces danger of further decline towards 0.89. The rise in industrial commodities can help.
Among the R-currencies, the Rouble (32.99) looks like it can weaken to 33.30, if not more. the Real (2.2290) also looks weak as the USDBRL has Support at 2.2085. The Rand (9.9102) also looks like it can weaken as the USDZAR can bounce within its overall range of 9.80-10.20. The Asian currencies are looking a little strong.
Dollar-Rupee (59.5150) can continue to rise as the charts are still Oversold near-term.
The US 10-Yr (2.48%) is consolidating ahead of the US FOMC data on Friday and the AD Employment data tomorrow. Expect Support at 2.40% of course. Chances of rise towards 2.65% remain.
4:30 GMT or 10:00 IST RBA Meeting
...Expected 2.75 % ...Previous 2.75 %
...Actual 49.6 ...Previous 43.80
JP Tankan Large Manufacturers Index
...Actual 4 ...Previous -8.00
...Actual 50.3 ...Previous 50.10
...Actual 50.00 ...Previous 48.10
...Actual 51.9 ...Previous 52.2
...Actual 52.50 ...Previous 51.3
...Actual 12.10 ...Previous 12.00
US Manufacturing ISM
...Actual 50.9 ...Previous 49.0
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