Wednesday September 18, 2013 - 03:46:25 GMT
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Morning Briefing : 18-Sep-2013 -0342 GMT
Near term upside potential seen in Equities, but long-term Resistances are approaching. Some Indices, like the Shanghai, have come off from Resistances already. Be careful about being gung-ho on Equities.
Dow (15529.73, +34.95, +0.23%) was very quiet yesterday. It can rise to 15700 after the FOMC meeting tonight, but could be in danger of falling back towards 15000 later on. The Nasdaq (3745.70, +0.75%) is kissing a long-term trend Resistance on the Weekly Line chart and could see profit-taking. Like the Dow, the DAX (8596.95) has been quiet. It can rise after the FOMC and then come off later in the week.
The Nikkei (14565, +1.77%) is up strongly today after having fallen yesterday. It is looking positively bullish now for a test of 15000. Could find decent Resistance there, though. The Shanghai (2186) is flat today after a sharp drop yesterday. Long-term Resistance at 2270 holding well. Can test near-term Support at 2160. Deeper, stronger Support at 2127.
The Nifty (5850.20) too could rise to 5975 but fall back from there.
Gold (1294) has fallen below 1300 ahead of the FOMC Meeting. The Weekly Line chart looks weak. There is a long term trend Support at the current levels, but we may see the prices coming down to 1275 if it does not bounce from here. Silver (21.44) is down. The Resistance at 22.25 continues to hold well and there are decent chances of seeing a fall to 20.
Copper (3.2145) is stable since yesterday. Still testing resistance and consolidating for now between 3.20-3.25.
Nymex WTI (105.63) has a crucial and possibly a strong support at the current levels as seen from the 3-Day Line chart. If this holds we may see prices bouncing back to 108-110. But, Brent (107.85) looks like it can fall further to 107 and maybe even 104 before it can bounce back to 108-109.
The Euro (1.33503) has strengthened against the Dollar before the end of the FOMC. There is a resistance at 1.3352 on the 200-week MA. Dollar index (81.206) has come below 81.275 and is finding it difficult to move downwards breaking 81. The Yen (99.26) is steady after having weakened from 98.64 the day before. See it ranged sideways overall between 98-100.
Pound (1.5896) is up a bit maintaining the near term uptrend. There is a mid term resistance at current level on the Weekly and a channel resistance at 1.60 on the Daily. If this holds we may see a fall towards 1.57.
Aussie (0.9342) is also up eventually targeting 0.95 and up in the coming weeks. It is likely to consolidate for sometime now rising in a slow pace.
Dollar Rupee (63.38) went up yesterday bouncing off from an intra-day low of 62.95. It may rise up to 63.60/075 today.
Markets can be perverse. In case tonight's taper is less than the $10-15 bln that's been priced in, the markets could start worrying about growth prospects. If so, Equities could come off after an initial spurt. Be careful.
The US 10-Yr (2.84%) has dipped below trend Support, of course, and could move down to 2.80-2.75% in the coming days. The German-US 2-Yr Spread (-0.16%) has moved up a bit more, favouring the Euro. The US-Japan 10-Yr Spread (2.12%) is testing strong channel Support at current levels and could bounce from here, supporting Dollar-Yen.
The Indo-US 10-Yr Spread (5.61%) has some Support at 5.50% and may range between 5.50-75% for a while more. A break below 5.50%, on the other hand, may signal a decline towards 5.25% or lower.
8:30 GMT or 14:00 IST UK BOE Minutes
...Expected 0-0-9 % ...Previous 0-0-9 %
12:30 GMT or 18:00 IST US Housing Starts (Mln)
...Expected 930 K ...Previous 896 K
18:00 GMT or 23:30 IST US FOMC Meeting
...Expected < 0.25 % ...Previous < 0.25 %
UK CPI Y/Y
...Actual 2.70 % ... Previous 2.80 %
EU Trade Bal
...Actual 11.10 EUR Bln ...Previous 14.90 EUR Bln
EU EA (17) Curr Acct Bal
...Actual 16.90 EUR Bln ...Previous 19.80 EUR Bln
US Core CPI (MoM)
...Actual 0.20 % ...Previous 0.06%
US TICS (Net foreign purch of long-term Sec)
...Actual 31.07 $ Bln ...Previous -67.00 $ Bln
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