The Dollar was lifted after FOMC meeting and stronger than expected economic data covering retail sales, PPI, and inventories. The FOMC left rates unchanged at 0-0.25% as expected. The Fed did not alter the statement on QEII, and its assessment of economic conditions was largely unchanged. Fed maintained the $600b longer-term treasury securities purchase program and planned to carry out about $75b per month. The Euro tested 1.3500 but failed at the key resistance and pulled back to 1.3348 levels after the US FOMC statement. ECB Trichet urged EU countries to give the European Financial Stability Facility (EFSF) maximum flexibility in both size and scope. The Yen tested below Y83 before stronger US Eco data but traded at 83.80 levels when US bond yields increased after the FOMC. The Sterling trading at 1.5761 after tested 1.5900 levels on Strong CPI at 0.4% m/m in November pushed yearly figures to 3.3%. The Aussies broke above 1.0000 and traded under parity after overcoming much of the USD strength.
EUR/USD: The Euro is currently trading at 1.3350 levels and touched higher 1.3498 yesterday. Immediate support comes at 1.3330 levels. While resistance comes at 1.3440 levels & next 1.3625 levels. EURINR (60.42) - Importers can cover near 59.50 levels. Exporters are suggested to book near term exposure near 60.50 levels. Short term Neutral Medium term: Bearish. EUR/INR is likely to trade in the range of 60.30 - 60.60 today.
GBP/USD: The Pound is currently trading at 1.5762 and touched high of 1.5911 yesterday. Immediate strong resistance comes near 1.5980 levels (100 days Weekly EMA), while support comes at 1.5740 levels (100 days EMA, Daily). GBPINR (71.34) 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 and 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 83.79 levels, and had tested below 83 levels before stronger US Retail Sales data yesterday. Immediate Support is at 83.15 (55 days Daily EMA) followed by 82.68 (21Days Daily Bollinger) 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 near 82.50 levels and Yen Importers can cover their exposure above 84 levels. Medium Term: Maintain Bearishness.
AUD/USD: The Aussie is currently trading at 0.9950 levels after breaking the parity levels yesterday. Consumer sentiment increased to 0.2% than previous at -5.3%. Immediate support comes at 0.9840 levels (21 Daily EMA) while immediate resistance is at 1.0000 levels. Exporters are suggested to book Dec and Jan month's exposure above the parity levels, and Importers can cover their exposure on dips (0.9750 - 0.9850 levels). Medium term: Bullish
Gold: Gold (1396.48) had rallied and had breached key resistance at $1400 yesterday. Yellow metal pushed above $1400 yesterday but then reversed sharply from those levels to finish unchanged. Overall it traded with a low of $1391 and high of $1408. Immediate resistance is at $1410 levels followed by $1,431.28 levels while immediate support comes near $1387 levels followed by downside $1364 levels. Medium term: Maintain bullishness.
DOLLAR INDEX: Dollar Index is currently trading at 79.55 levels and had made a multi week low before the US data was released yesterday. Core Retail Sales m/m came at 1.2%, better than previous at 0.8% while PPI m/m was at 0.8%, better than previous at 0.4%. FOMC left rates unchanged at 0-0.25% as expected. Fed maintained the $600b QE programme unchanged to promote a stronger pace of economic recovery. Looking ahead today, Core CPI m/m and TIC Long-Term Purchases. 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.