Monday July 29, 2013 - 03:39:15 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 29-Jul-2013 -0336 GMT
Equities look weak globally.
The Dow (15558.83) has risen a bit. It may see itself falling towards 15470 if it does not rise past 15600 in the near term. Note that other Equity markets are weakening. .
Asia–Pac is down today. The Shanghai (1987.45) broken below earlier support as warned on Friday. It could be in danger of a decline towards 1900 during the week. Nikkei (13810.04) has fallen below 14000. It may see a fall towards 13500 before rising again.
Nifty (5886.20) is falling sharply targeting 5800.
Commodities are mixed.
Brent (107.18) hasn't moved much. Charts show some scope of a fall towards 106-105-50 if it breaks below 107. Overall, we still target 109-10 in the long term.
We got it wrong on Copper (3.10). It has come down significantly from around 3.19. If immediate Support near current level breaks, we could see a further fall towards 3.0.
Silver (19.79) has been unable to sustain past the 20 mark and is looks bearish. We can expect a further fall towards 19-18.50-18 if this trend continues.
Gold (1328.76) remains in an overall uptrend. The weekly charts looks bullish towards the 1375 mark provided the support at 1300-10 holds.
The Dollar is down overall.
The Euro (1.3290) is stronger on the German-US 2-Yr Spread (-0.16%) narrowing in its favour. We look for a test of 1.3350-3400 this week. May see good profit-taking there.
The Pound (1.5399) is consolidating after a rise to 1.5434 on Friday. It continues to look bullish for a rise towards 1.5450-5500. The EURGBP (0.8629) has Support at 0.8590 and could rise in the medium term. This favours a rise in the Euro in the medium term.
Dollar-Yen (97.70) has broken below 98.45, as warned. Clear Double Top now, targets 96.30 in some days. The Euro-Yen (129.89) has also broken an important medium term uptrend and could test a crucial Support at 128.90.
The R-currencies are trading mixed. The Real (2.2520) and Rouble (32.80) are trading weaker. The Rand (9.7610) retains its recent strength. Dollar-Rupee has strong Resistance at 59.35-45 and may well get Sold on rallies. Chances of Rupee strength going forward.
US Yields have dipped.
The market is going into the FOMC (Wednesay) hoping for a dovish outcome. The US 10-Yr (2.56%) has come off from 2.60% and may trace a Bear SHS targeting 2.35% in the medium/ long term.
The German-US 2-Yr Spread (-0.16%) continues to narrow in favour of the Euro.
The RBI Monetary Policy Meeting is due tomorrow. The accent is expected to be on the protection of the Rupee. The dip in the US 10-Yr to 2.56% would be a welcome relief for the RBI-Government.
No major data release today.
No major data release on Friday.
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