Tuesday July 9, 2013 - 03:26:56 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 09-Jul-2013 -0325 GMT
Some relief for markets worldwide as the US 10-Yr Yield (2.65%) comes off a bit from Resistance at 2.75%.
Dow (15224.69, +0.59%, +88.85) has closed just above crucial range resistance at 15200. We favour a dip back to 14800, but if the gains of the last two weeks are sustained then a 15500 could be seen. The DAX (7968.54, +2.08%) surprised with a solid rise yesterday. The overall uptrend since 5900 (Jun-2012) remains intact and a break above 8000 would target 8300.
All of Asia-Pac (except China) is up today after the dismal opening yesterday. Possibly yesterday could have been a one-day reaction to the US Non Farm Payrolls released last Friday. Even the fall in the Shanghai (1956, -0.13%) is only minor today. Medium term Support is seen at 1800. In contrast, the Nikkei (14280, +1.21%) is up could come down from Resistance in the 14400-500 region.
The Nifty (5811.55) has been consolidating between 5750-5900. Further sideways consolidation can give way to eventual rise.
Commodities look a little better today. Especially Copper.
Gold (Spot 1251.19) has bounced back a bit from 1208 and could be priming for a rally towards 1295, which could catch people Short. The bigger trend is bearish while below 1365. In India MCX Gold (26027) remains weak overall.
We are not being able catch Silver (19.31) well for the last few days. Like Gold, it may have built itself a Support above 18.50. If so, it could rise back to 20.00. Indian MCX Silver (40187) remains bearish overall but could see a near-term bounce.
Brent (107.04) is seeing some profit-taking from 108. There is room towards 115 in the long term now. Some consolidation between 108-105 could be seen before the market starts pushing for 115. Copper (3.1030) has done well to move back up a bit yesterday. Failure to rise would have been worrying.
The Euro (1.2855) is managing to remain above 1.28. Further Support is seen at 1.2750. But, Resistance is also there at 1.2940. Picture is unclear / bearish for now. The Pound (1.4935) has risen a bit yesterday but may be bearish for 1.47 in the coming weeks. It looks weaker than the Euro (Cross 0.8606 is seen inching up).
Dollar-Yen (101.01) remains in an uptrend for now with Support at 100.60 and possible target of 103.40. But we also have to remember it has risen 7.4% since the beginning of June. So, we are nearing the end of the rise. The Aussie (0.9120) rose a bit yesterday, but is unable to shake off its downtrend while below 0.9180-9230.
The USDRUB (Rouble, 33.19) is finding Resistance near 33.37, in line with expectations. The USDZAR (Rand, 10.16) is also finding Range Resistance just below 10.30 for now and could come off for a few days.
Dollar-Rupee (60.61) could dip to 60.00 over today-tomorrow, but there is crucial Support there, which could hold.
The US 10-Yr (2.65%) has come off a decent bit from the 2.75% Resistance. A lot of the "taper talk" is in the price and there could be chances that the Yield actually comes back down towards 2.40% in a few weeks if the Resistance continues to hold.
The German-US 2-Yr Spread (-0.28%) has Support near current levels now and could bounce back a bit. This could help the Euro recover some losses.
9:30 GMT or 15:00 IST UK Trade Balance
...Expected -8.40 £ (Bln) ...Previous -8.22 £ (Bln)
No major data release yesterday.
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