The Dollar trading risk was off as China stocks lost 3% on tightening fears allowing the USD to get a bid tone. Looking ahead, November Long Term TIC Flows forecast at 40bn vs. 27bn previously. Also ahead, Bank of Canada rate decision forecast at 1%. The euro was near $1.3278, after having slid to a low $1.3243, as markets await the meeting between EU finance ministers in Brussels on expanding the current debt crisis handling programs. Germany is reluctant to expand the fund and this is causing tension with other members so far. The Yen was quiet fell to 82.50 levels after failing to gain a foothold above the level. The Sterling was strong testing above 1.5900. Talk that the BOE might have to raise rates to fight stubbed inflation. Meanwhile the Aussie is soft today as troubled by the record floods and Asian equities are generally lower in response to the reserve ratio hike from China announced late last week.
EUR/USD: The Euro currently trading at 1.3282 levels after making a low of 1.3243 levels yesterday. No significant decisions were made with regards to the rescue fund at yesterday's meeting in Brussels'. Looking ahead today, German ZEW Economic Sentiment expected 6.5 vs. 4.3 previously. Immediate support comes at 1.3258 (21 H4 EMA) followed by 1.3235 (200 H4 EMA), while strong resistance comes at 1.3312 levels (100 and 200 Daily EMA). EURINR (60.45) exporters should cover at current levels and importers cover for Jan and Feb partially towards 59.50 levels. EUR/INR is likely to trade in the range of 60.30- 60.60 today. Short term and Medium term: Slight Bearish.
GBP/USD: The Pound extended its gains and is currently trading at 1.5925 levels. Looking ahead today, CPI y/y expected stable at 3.3% while HPI y/y at 5.2% vs. 5.5 earlier. Immediate support comes near 1.5855 (Daily Upper Bollinger) while resistance at 1.5945 (100 Weekly EMA). GBPINR (72.46) Exporters should partially cover at current levels and importers cover partially for Jan towards 71.50 to 71.80 levels. GBPINR is likely to trade in the range of 72.35 - 72.65 levels today. Short Term and Medium Term: Neutral to slight Bearish
USD/JPY: USD/JPY is currently trading at 82.61 levels. Looking ahead today, Industrial Production m/m expected stable at 1.0%. Immediate resistance is at 82.89 levels (55 Daily EMA and Fibo) followed by 83.33(100 Daily EMA) while support is at 82.50 levels (Middle Bollinger Daily). Yen Exporters are suggested to book Jan and Feb month's exposure around 81 levels and Yen Importers to cover their exposures near 84 levels. Medium Term: Maintain Bearishness for the pair Target 80 and below.
AUD/USD: The Aussie currently trading at 0.9909 levels after making a high of 0.9969 levels overnight. Immediate support comes at 0.9832 levels (Weekly Middle Bollinger) followed by 0.9788 levels (100 Daily EMA) while immediate resistance is at 0.9955 (21 Daily EMA). Exporters are suggested to book Jan and Feb month's exposure towards parity levels, and Importers can cover their exposure on dips. Medium term: Bullish.
Gold: Gold rebounded and is currently trading near 1362.80 levels after Greece downgrade yesterday thereby boosting the yellow metal demand. Support for gold is near 1355 levels (100 daily EMA) and Immediate resistance is at 1376 (55 daily EMA) followed by 1380 levels (21 daily EMA). Buying on dips is recommended. Medium term: Maintain bullishness.
DOLLAR INDEX: Dollar Index is currently trading at 79.40 levels. Looking ahead today, TIC Long-Term Purchases forecasted better at 43.4B vs. 27.6B previous. Immediate Support at 79.20 (Daily Fibo) levels and resistance is at 79.74 levels (55 day daily EMA). Staying above 80.00 levels can take the index higher. Medium Term: 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.