Monday December 8, 2014 - 03:08:28 GMT
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Morning Briefing : 08-Dec-2014 -0307 GMT
Dow (17,958.79, +0.33%) achieved one its highest closing on back of strong US jobs data. Though the trend is bullish, we would still advise caution. Interestingly, there seems to be some divergence developing between Dow and S&P500, with S&P500 hardly moving and still forming a double-toppish formation.
Nikkei (17,930.23, +0.05%) is trading flat after reaching an intermediate target of 18,000. We now look for a conclusive cross above 18,000, for a target of 18,250 and 18,350 in short term.
Shanghai (2,936.55, -0.04%) is trading flat after reaching the highs of 2,953 levels. 2,960 has held back the rally on Friday as well as today. Having run up so hard and fast, it we have to look at any levels that can potentially turn into resistance-tops. The target remains at 3000 levels, and considering 2960 as a intermediate resistance. The trend remains bullish, and shorting is not advised.
Dax (10,087.12, +2.39%) has now broken above the 10,000-10,035 barriers. Technically, the rally should start anew with renewed vigor. However, we wait and watch for signs of its consolidation and sustaining above 10,000 levels before buying into Dax.
Nifty (8,538.30, -0.30%) retraced from its Fibonacci resistances of its fall at 8,595. For today, we expect it to trade in the range of 8500-8550. For the day the supports are at 8,500 and on the break lower at 8,400. 8,550 and 8,595-8,600 is the resistance.
Metals are all trading lower except Copper while Dollar holds gains.
Gold (1193.98) and Silver (16.279) are trading lower. Small positive movements are expected while Dollar holds gains. We may soon see a rise towards 1225 and 18 respectively in the mid-term.
Brent (68.37) and Nymex WTI (65.16) are trading lower but are still above our first target of 67.53 and 63.75 respectively. Higher possibility of not breaking those levels on the downside but a break if seen could take the prices lower to 65 and 63 respectively.
Copper (2.9265) is stable for now while the 2.85-2.95 region holds. Near term fluctuation may however remain with no clear view of further direction. Longer term trend is down.
Euro (1.2291) fell on Dollar strength due to good US data. The series of lower lows indicate continuation of trend albeit with lower momentum. We expect 1.2250 to be reached in short term.
Pound-Dollar's (1.5572) the 1.56 level was able to support Pound for three weeks now, and today we break below that. 1.5600 now turns into a strong resistance in short term, and our immediate target on the downside is 1.5500-1.5475. The next targets are 1.5440 and 1.5400.
Dollar-Yen (121.58) is moving strong, and the trend is now confirmed upwards. The next immediate target is 1.2280-1.2300. Preferred mode of trade would be buying on the dips of 1.20 re-test process with a stop loss below 118.00 or 117.2.
Dollar-Rupee (61.77) has come into the buy range of 61.70-61.80. This is a good place to buy Dollar-Rupee. Our bias remains towards weakening of Rupee. We could see Dollar-Rupee bounce from 61.70-61.80 zone towards 62.20 resistance and 62.35 targets. There is high probability this move could happen in December'14.
Aussie-Dollar (0.8305) dipped to a new low of 0.8293. We expect this fall to continue. Our targets of 0.8320 are achieved and we now look at 0.8200 as target and a place of support for Aussie.
The German yields have risen. The 2Yr (-0.013%) is up from -0.019% on Friday while the 10Yr (0.779%) has also risen from 0.772%. France 10Yr (1.024%) has also risen while Greek 10Yr (7.074%) has fallen sharply from 7.511%
The US bond yields have also fairly risen on Dollar gains. The 2Yr (0.641%), 5Yr (1.680%), 10Yr (2.305%) and the 30Yr (2.965%) are all up from 0.542%, 1.579%, 2.241% and 2.939% respectively. Dollar may continue to remain strong in the near term keeping the yields higher.
The UK Gilts have risen. The 5Yr Gilts (1.391%) has risen from 1.341% and the 10Yr (2.026%) has risen from 1.991%.
Indian 10Yr (7.9358%) has fallen from 7.967% and is targeting 7.80% in the coming weeks.
2:00 GMT or 7:30 IST CN Trade Bal
...Previous 45.4 Bln ...Actual 54.5 Bln ...Expected 44.3 Bln
11:50 GMT or 17:20 IST JP GDP
...Actual -0.5 % ...Expected -0.1 % ...Previous -0.4 %
...Previous 0.80 % ...Actual 0.80 %
...Expected 225 K ...Previous 243 K ...Actual 321.0 K
US Unemployment Rate
...Expected 5.8 % ...Previous 5.8 % ...Actual 5.8 %
US Trade Balance
...Expected -41.20 $ Bln ...Previous -43.60 $ Bln ...Actual -43.43 $ Bln
CA Labour Force
...Expected 5.3 K ...Previous 43.1 K ...Actual -10.70 K
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