Wednesday October 30, 2013 - 03:51:17 GMT
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FX Thoughts for the Day - www.fxthoughts.com
Morning Briefing : 30-Oct -2013 -0347 GMT
Equities are all up before the end of the FOMC meeting today.
Dow (15680.35, +0.72%) has sharply risen targeting 15800 in the near term. Nasdaq (3952.34,+0.31%) is in an overall uptrend targeting 4000.It is just below the resistance on the daily.
Dax (9022.04, +0.48%) is also in an uptrend and is just below the resistance on the weekly chart. A break above 9500 may lead it towards 9100-9200.
Asia-Pac is all up. Nikkei (14507.28, +1.2%) has risen and is maintaining a steady upward movement. We may see a near term rise towards 14800. Shanghai (2137.69, +0.41%) after a high fluctuation yesterday may become a little stable. We are still bearish if it breaks below 2125, else a rise towards 2150-2175 may be expected.
Nifty (6220.90) had shot up high yesterday after the RBI Meeting. It may consolidate a bit now but there are chances of a rise towards 6500
Gold (1340.60, -0.36%) has dipped further falling below the near term support at 1350 on the daily. It is testing resistance at current levels on the weekly and may fall further if that holds. Silver (22.42, -0.34%) has dipped a bit but may test near term resistance at 23 from where it may fall back towards 21-20.
Copper (3.2880) continues to consolidate sideways and may be ranged so for some more time.
Brent (108.72, -0.27%) has fallen but there are chances of a rise towards 112-113. Else we may expect a fall towards 106-105. Nymex WTI (97.62, -0.59%) declined for a second day on increase in the US stockpiles. We may see a rise to 100-101 in the near term if it does not fall further.
Euro (1.3737) is in a mild corrective mode as stated yesterday morning. It is trading around exactly the midpoint of the zone of 1.3650-1.3850 range as it waits for the result of the ongoing U.S. FOMC meet. Any surprise from the meet can move it to either towards 1.40 on the upside or 1.3470-1.35 on the downside.
Dollar Index (79.66) is showing some strength as it rallies toward the target of 79.80 given yesterday morning. The fear of QE tapering coming sooner than expected is keeping the Dollar bears on their toes and they look like waiting eagerly for the all important FOMC meet too.
Pound (1.6037) is trading close to the lower side of the inner range of 1.6020-1.6260. After yesterday's fall it is moving in a narrow range today so far. A break below 1.60 can drag it to 1.5880/90, the most important support of all.
Dollar Yen (98.17) rallied nicely to break the important 98 level. We had noted the bear exhaustion on yesterday's morning brief. Now a break above 99-100 would give us the major bullish confirmation, failing which more range bound action would be expected.
EURJPY (134.87) keeps its trend up hit 135. The price action near the major supply zone of 135.50/80 remains to be seen.
Aussie (0.9479) hit 0.9470 as expected on the last morning brief. The price action near the major support zone of 0.9390-0.9430 would give us the clue for the next direction. Currently it is trying to hold this zone as it tries a feeble bounce from 0.9455.
USDINR (61.32) remains stuck in the range even after the RBI policy announcement though the equities were affected a lot. No major moves expected till the range breaks. Perhaps the FOMC meet can be a trigger.
INTEREST RATESDATA TODAY
We had the RBI Meeting yesterday where Governor Raghuram Rajan announced a 25bp increase in the Repo Rates to 7.75%, and a 25bp cut in the MSF to 8.75%. The Indian GOI yields have fallen with the 10-Yr trading at 8.56%.
Japanese yields have remained stable ahead of the outcomes of the BOJ Meeting and FOMC. The Japan 10-Yr (0.61%) has come up to a resistance near current levels and may fall from here.
The US-10-Yr (2.50%) has dipped ahead of the FOMC announcement. Markets are eagerly waiting to see whether the Fed makes any changes to its bond buying program.
9:00 GMT or 14:30 IST EU Biz Climate
...Expected 97.5 ...Previous 96.9
12:15 GMT or 17:45 IST US ADP Emp
...Expected 150 K ...Previous 166 K
12:30 GMT or 18:00 IST US GDP
...Previous - 2.50 %
12:30 GMT or 18:00 IST US Core CPI (MoM)
...Expected 0.20 ...Previous 0.20
18:00 GMT or 23:30 IST US FOMC Meeting
...Expected <0.25 % ...Previous < 0.25 %
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