Monday August 26, 2013 - 03:36:02 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 26-Aug-2013 -0333 GMT
Equities are up overall.
The Dow (15010.51, +0.31%) rose from on Friday given the fall in the US New Home Sales. The support at 15000 holds well for now, but It needs to rise past 15200 to reduce the dangers on the downside.
Nikkei (13662.38, +0.01%) is up only marginally today. The support at 13200 holds well, but it faces crucial Resistance near current levels. A break above 13800 is needed to bring up 14300 on the upside. Hopefully a weaker Yen might help. Let's see. Shanghai (2066.95, +0.46%) had fallen to 2025 on Friday but has bounced back a bit. It still seems consolidative, caught between a near term uptrend and longer term downtrend. A rise past 2100 is needed to empower the Bulls.
Nifty (5471.75) had risen sharply on Rupee strength on Friday. A tesf of 5550 is likely in the early part of the week, but there can be chances of a dip towards 5400-5350 from there, later in the week.
Commodities are up overall.
Gold (1394.60) has broken Resistance at 1375 and may now further move up to 1425-1450. Silver (24.20) has reached our target of 24.There is a resistance coming up at 25. It needs to be seen whether the resistance holds and brings down the prices or Silver rises past the resistance to 26.
Copper (3.3730) is rising steadily to our target of 3.40. It faces a long term resistance at 3.45-3.50.
Nymex WTI (106.84) is in an uptrend moving towards 107-108. It could climb up to 110 in the coming weeks. Brent (111.17) has broken above the long term resistance at 111. A rise towards 114 can now be expected.
The Euro (1.3379) remains indecisive between 1.33-34. On balance, though, the Euro could move up if it manages to remain above 1.33. It could get help from a weakening Yen also with the Euro-Yen (132.00) showing potential of moving higher. The Pound (1.5568) has been losing ground over the last few days as it it not being able to rise past 1.5720. It has weakened against the Euro and Yen as well and could be in danger of falling towards 1.54 against the Dollar if it fails to bounce soon.
Dollar-Yen (98.65) continues to trade strong after breaking past earlier resistance at 98.40. We see chances of eventual rise past crucial Resistance at 99.15.
The Aussie (0.9030) is bouncing from the low of 0.8932 seen last week. The outlook is not clear at the moment. The Aussie is either ranged between 0.8930-9180 or bearish while below 0.9065. We'd place slightly greater weightage on the "ranged" option. Let's see if it manages to rise past 0.9065 or not.
The R-currencies gained a decent bit on Friday, especially the Brazilian Real (2.3583) which appreciated almost 3.9% from 2.4539 on Thursday. The Rupee (63.20) could see further appreciation today as the US Yields have come off on Friday.
US 10-Yr (2.83%) had dipped to 2.80% on Friday after the sharp decline in US New Home Sales. Reminds that the markets are not unidirectional. The eventual rise towards 3.05% might still be on the cards but there could also be arguments now that a top is in place already. Keep a watch on this.
The Japanese 10-Yr (0.77%) has been coming off steadily from levels just below 1.0% over the last couple of months, but could see a bit of a bounce now for a short while. The German 10-Yr (1.94%) has been rising for some time now and could move a little higher, helping the Euro a bit.
12:30 GMT or 18:00 IST US Durable Goods Orders
...Expected -3.00 % ...Previous 3.86 %
...Actual 0.71 % ...Previous 0.60 %
CA Inflation Y/Y
...Actual 1.30 % ...Previous 1.20 %
US New Home Sales
...Actual 394 K ...Previous 455 K
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