Dollar recovered some ground as focus turned back to Europe's sovereign-debt problems after Moody's Investors Service said it would consider downgrading Portugal. Stock markets are continuing to rally and this is keeping risk appetite strong in Holiday trading. Looking ahead, US Q3 GDP forecast at 2.8% vs. 2.5%. The Euro was able to test 1.3200 after China said they would take concrete action to support EU Debt but made lower 1.3072 level after warnings Portugal and Greece faced more ratings suggested the euro zone's debt crisis was far from abating. The Yen strengthen against the major but recovered with support at 83.50 levels. The sterling took a blow from news of a record British borrowing requirement and slipped to a near three-month low of $1.5463. November UK Public borrowing increased to GBP22.8bn vs. 8.6BN previously. The Australian dollar gained 0.3%, rising to 0.9970, after minutes from last month's RBA policy meeting were released.
EUR/USD: The Euro is currently trading at 1.3134 levels and it touched low of 1.3072 levels yesterday. Immediate support comes at 1.3055 levels (21days Daily lower Bollinger) and next 1.2970, while resistance comes at 1.3220 levels & next 1.3400 levels. EURINR (59.38) exporters cover near 60.00- 60.40 levels and importers cover between 59.20- 59.40 levels. EUR/INR is likely to trade in the range of 59.25 - 59.55 today. Short term and Medium term: Bearish.
GBP/USD: The Pound is currently trading at 1.5480 levels and it touched low of 1.5434 after November UK Public borrowing increased to GBP22.8bn vs. 8.6BN previously. Immediate resistance comes near 1.5530 and next 1.5636 levels (200 Days daily EMA), while support comes at 1.5280. GBPINR (69.90) Exporters cover near 70.60 - 71.00 levels and importers cover between 69.80 -70.00 levels. GBPINR is likely to trade in the range of 69.80 - 70.10 today. Short Term and Medium Term: Neutral.
USD/JPY: USD/JPY is currently trading at 83.77 levels. BOJ left policy unchanged, as expected while Japan's all-industry index declined by 0.2% in October. Trade Balance came at 0.43T vs. 0.58T previous. Immediate Support is at 83.20 (55 Daily EMA) while immediate strong resistance is at 84.20 levels (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 0.9966 levels. Yesterday Aussie had hovered near the parity levels by making a high at 0.9993 and a low of 0.9946 levels. Overall the AUD/USD traded with a low of 0.9862 and a high of 0.9973. Leading Index m/m came at 0.3% vs. Previous 0%. Immediate support comes at 0.9870 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. Medium term: Bullish
Gold: Gold ($1388.95) was well supported holding above $1380 levels yesterday after China had pledged to assist the Euro-zone which lifted optimism. Overall gold traded yesterday with a low of $1380 and high of $1392. Immediate resistance is at $1410 levels followed by $1,431 levels while immediate support comes near $1365 levels. Buying on dips is recommended. Medium term: Maintain bullishness.
DOLLAR INDEX: Dollar Index is currently trading near the resistance level of 80.50 levels. Looking Ahead today, Final GDP q/q expected 2.8% vs. previous 2.5% while Existing Home Sales expected 4.72M vs. 4.43M previous. There is a support at 79.20 levels and resistance is at 80.52. Bias is slightly bullish for Dollar Index. Break of 80.52 and sustaining would be quite bullish for the index. 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.