India Forex Advisors / Market Commentary /09_Mar_2011

By @ibtimes on

Dear Reader,

Global Markets:

The U.S. dollar was stable, paring a modest portion of its recent losses as U.S. crude prices declined on talk of OPEC raising supplies. US 10yr treasury yields rose 2bp with the rise in equities. The Euro fell as sovereign debt concerns again came back into focus by near record levels in peripheral nations CDS and increasing yield spreads. EUR French Trade Balance came out weaker at -5.9B vs -5.1B previously and German Factory Orders m/m came out better at 2.9% vs -3.6% previously. The Sterling was weak yesterday as the market seems to be waiting for the BOE rate announcement on Thursday. JPY Core Machinery Orders m/m came out better at 4.2% vs 1.7% previously. It can be an indicator that the spending by the Japanese companies can be due to global demand and improvement of the global economic situation. Magnitude 7.1 earthquake strikes 120 miles east of main Japan Island. In Aussie, Home Loans m/m came out weaker at -4.5% vs 2.1% previously and Westpac Consumer Sentiment came out weaker at -2.4% vs 1.9% previously. There were rumours of Gaddafi may step down and a rebel spokesman said they would allow his peaceful exit which lead to a little decline in Oil prices.

Technical Outlook:

EUR/USD: Euro is currently trading below 1.3900 levels after EU debt fears increased and comments from S&P that further Greek default was possible. Immediate resistance is at 1.3925 levels while psychological resistance is at 1.40 and immediate support is seen at 1.3860 levels (55 4hrly EMA). German Industrial Production m/m is expected to improve. EURINR (62.48) exporters can cover near 63 levels for March exposure and Importers can cover partially near 62 levels. EUR/INR is likely to trade in the range of 62.25 - 62.75 today. Short term: Slight bullish and Medium term: bullish.

GBP/USD: Pound declined and is currently trading at 1.6157 levels awaiting tomorrow's BOE rate announcement with expectations of more rate hikes in the current year. Daily stochastic is showing downward direction. Immediate strong support comes at 1.6135 (H4 21 Lower Bollinger) followed by 1.6095 levels (H4 200 EMA) and resistance is seen near 1.6185 levels (21 Daily EMA and 21 middle Bollinger). Trade Balance is expected to improve. GBP/INR (72.67) March month's exporters should cover near 73 levels and importers cover near 72.35 levels. GBPINR is likely to trade in the range of 72.50-72.80 levels today. Short Term: Slight Bullish and Medium term: bullish

USD/JPY: The pair rose towards Y83 levels after Core Machinery Orders m/m increased to 4.2% as against 2.7% expected, thus indicating a step to economic recovery. Daily Stochastic is showing slight upside movement. Immediate resistance is at 83.05 levels (Weekly 21 EMA) while immediate strong support is at 82.60 levels (Daily 21 Middle Bollinger). Yen Exporters are suggested to book March month's exposure partially near 81.75 levels and further on dips while Yen Importers can cover their exposure towards 82.90 levels and above. Medium Term: Maintain Bearishness

AUD/USD: The pair nosedived towards 1.0060 levels after making a high at 1.0134 levels yesterday. The main focus will remain on New Zealand rate announcement tomorrow. Immediate support is seen near 1.0045 levels (55 Daily EMA) while Immediate resistance is seen near 1.0100 levels (21 Daily EMA). Exporters are suggested to book March month exposure partially above 1.0150 levels, while Importers can cover their exposure near parity levels. Medium term: Bullish.

Gold: Gold declined for consecutive second session trading near $1426 levels after some profit booking was seen at higher levels. Overall trading with a high of $1436.79 and low of $1423.10. Support is seen near 1420.65 levels and trading above 1440 resistances levels will confirm long term uptrend. Medium term: Maintain bullishness.

Dollar Index: Dollar Index is currently trading at 76.85 levels. Immediate resistance is seen near 77.16 levels while support near 77.55 levels. Daily stochastic is showing upside momentum. Short Term: Bearish and Medium Term: Neutral.

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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