The Dollar's decline also followed an abrupt drop in U.S. Treasury yields and Moody's warning that it could move a step closer to cutting the U.S. triple-A credit rating. The dollar extended losses giving up an earlier advance against majors, as U.S. stocks and commodities gained ground of improved appetite for riskier assets on growing optimism on strong Chinese economic data and Beijing's unexpected decision to stand pat on interest rates. The Euro did reversed and made higher rising all day for a 200 pip gain, traded with a low of 1.3181 and a high of 1.3435 on US rating news. The Yen moved to 83.45, dragging towards Y83 after shedding 0.6 percent. The Sterling tracked the Euro move higher but could not keep up with the pace of the single currency. The Aussies trading at 0.9947, began to rally in late Asia when it became clear that China would not be raising interest rates in response to the strong CPI numbers over the weekend.
EUR/USD: The Euro is currently trading at 1.3385 levels and it moved higher 200 pips yesterday. Euro is trading in a bearish zone below 1.3440 levels. EURINR (60.22) - Importers can cover near 59.30 - 59.50 levels. Exporters are suggested to book near term exposure near 60.30 - 60.50 levels. Short term and Medium term: Bearish. EUR/INR is likely to trade in the range of 60.20 - 60.45 today.
GBP/USD: The Pound is currently trading at 1.5860. Immediate strong resistance comes near 1.5980 levels (100 days Weekly EMA), while support is expected around 1.5732 levels (21 days EMA, Daily). GBPINR (71.40) Exporters are suggested to book Dec month's exposure 71.40 - 71.60 levels, while Importers can cover partially on dips (70.50) levels. Short Term: Bearish; Medium Term: Neutral. GBP/INR is likely to trade in the range of 71.25 - 71.55 today.
USD/JPY: USD/JPY is currently trading at 83.45 levels, after it nosedived 100 Daily EMA levels of 83.76. Looking ahead, October Industrial Output previously was at -1.8%. Overall it was volatile trading with a low of 83.10 and a high of 84.35 levels yesterday. Immediate Support is at 83.12 (55 Daily EMA), while immediate strong resistance is at 84.20 (21 Weekly EMA). Yen Exporters are suggested to book Dec and Jan month's exposure on dips and Yen Importers can cover their exposure above 84 levels. Medium Term: Maintain Bearishness.
AUD/USD: The Aussie is currently trading at 0.9952 levels. It rose from 0.9840 to 0.9984, a fresh one-month high, tracking the news that China would not be raising interest rates after the strong CPI data. NAB Business Confidence came at 6, lower than previous at 8 while Housing Starts q/q was at -13.2%, compared to previous at 2.1%. Immediate support comes at 0.9830 levels (21 Daily EMA) while immediate resistance is at 1.0000 levels. Exporters are suggested to book Dec and Jan month's exposure near the parity levels, and Importers can cover their exposure on dips. Medium term: Bullish
Gold: Gold (1402.33) had rallied and had breached key resistance at $1400 yesterday. Overall the yellow metal traded volatile with a low of $1385 and high of $1407. Immediate resistance is at $1410 levels followed by $1,431.28 levels while immediate support comes near $1380 levels followed by downside $1350 levels. Medium term: Maintain bullishness.
DOLLAR INDEX: Dollar Index is currently trading at 79.35 levels tracking lower US treasury yields. Even after Moody's statement that the US tax package will lead to a negative outlook during the next two years affected the DI. Looking ahead today market is eyeing more on FOMC statement along with number of key events like core retails sales m/m, PPI m/m due from the economy. There is a strong support at 77.80 levels and resistance is at 80.50 levels. Medium Term: Slight Bullish
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.