IIndia Forex Advisors / Market Commentary /15_Feb_2011

By @ibtimes on

Dear Reader,

Global Markets:

The Dollar is quite firm against majors. President Obama forecast a wider budget deficit of $1.6trn then the previous prediction of $1.4trn. Euro is trading little stronger today and crosses 1.35 level again. Euroland industrial production down 0.1% in Dec. The Yen is steady above 83.00, but continues to find resistance near 83.50. Japanese Q4 GDP came in at -1.1% annualized which is closed to its expectation. China's consumer price index rose 4.9% in January from a year earlier but was below forecast and producer price index, which rose 6.6%, climbed more than expected. Aussie is trading at 1.0054, RBA has announced today its minutes of the Bank's meeting this morning that was held in February where the Bank decided to fix rates at 4.75% and the RBA indicated that a decline in consumer spending helped to curb inflation risks and supporting the bank to keep rates at their level.

Technical Outlook:

EUR/USD: The Eurusd retreated towards 1.3525 levels after touching three week lows at 1.3427. Market was more focused for Portugal as debt costs continued to remain high during the crisis period. It will be a busy day for Euro with lots of data piled up like German and French Prelim GDP q/q, German ZEW Economic Sentiment, Trade Balance and Flash GDP q/q. As mentioned earlier, If Euro stays below 1.3510 levels, we expect further downside towards 1.3425 levels. Immediate resistance comes at 1.3640(21 Daily EMA) while immediate support is seen at 1.3480 levels. EURINR (61.41) exporters can cover partially above 61.80 levels and very near term importers can cover below 61.25 levels. EUR/INR is likely to trade in the range of 61.20-61.60 today. Short term: Slight bullish and Medium term: Bearish.

GBP/USD: The Pound has been very range bound since last three consecutive sessions and is trading near 1.6065 levels. Today, BOE Inflation Letter will be an important market mover. The pair is not closing below 1.60 levels otherwise there are chances the pair to reach towards 1.5850 levels. Immediate support is at 1.6020 (100 Middle Bollinger) while resistance comes at 1.6135 (21 Upper Bollinger). GBPINR (72.90) Exporters should partially cover at current levels and importers hold for cover. GBPINR is likely to trade in the range of 72.75- 73.05 levels today. Short term: Neutral and Medium term: Bearish.

USD/JPY: Since last three consecutive sessions the pair is steady above the Y83 levels, and currently it is trading at 83.28 levels. Today Overnight Call Rate expected same as previous i.e. <0.10% with the BOJ meeting. Till the pair stays near 83.50, the bias remains bearish with strong support seen at 82.95 levels. Yen importers can cover Feb month's exposure at current levels and exporter hold for cover. Medium Term: Maintain Bearishness for the pair targeting 80.

AUD/USD: The Aussie is steady as yesterday trading near 1.0055 levels. Today, RBA has raised its forecast for the nations GDP to expand to 4.25% this year, thus fueling economic recovery and the supporting the economy to rebound. Strong Resistance is at 1.0100 levels while support at 0.9980 followed by 0.9880. Exporters are suggested to book partially above 1.0050 levels and Importers can cover their exposure on dips. Medium term: Bullish.

Gold: The yellow metal rebounded towards $1364.63 after breaching $1357 resistance levels. There was fresh buying seen in the safe heaven metal after China's import surged. Support for gold is near $1360 levels followed by $1354 while immediate resistance is at 1372 levels. As suggested earlier, Buying on dips is recommended. Medium term: Maintain bullishness.

Dollar Index: DI is currently trading at 78.44 down by 0.24%. Immediate support comes at 78.41 levels followed by 78.25, while resistance at 78.80 levels Medium Term: Slight Bullish (-0.22%). On the data front, Retail Sales m/m and TIC Long-Term Purchases are expected better.

DISCLAIMER
These views/ forecasts/ suggestions, though proffered with the best of intentions, are based on our reading of the market at the time of writing. They are subject to change without notice. Though the information sources are believed to be reliable, the information is not guaranteed for accuracy. Those acting in the market on the basis of these are themselves responsible for any profits or losses that might occur, without recourse to us. World financial markets, and especially the Foreign Exchange markets, are inherently risky and it is assumed that those who trade these markets are fully aware of the risk of real loss involved.

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