India Forex Advisors / Market Commentary /24_Feb_2011

By @ibtimes on

Dear Reader,

Global Markets:

The dollar is trading soft while other alternatives safe heaven is going strong as Middle East unrest continues. US Existing Home Sales came out better at 5.36M vs 5.22M previously. Euro was seen rising against dollar after Trichet said that he is confident that the European Parliament will push for better fiscal and economic governance in the Eurozone. EUR Industrial New Orders m/m came out better at 2.1% vs 2.2% previously. Sterling rallied upwards overnight as BoE minutes revealed that one more member voted for increasing interest rates amid heightened inflationary pressures. Japan bond yields touched a three- week low as unrest in Libya sparked concern of higher oil prices will slow the global recovery. AUD advanced against the greenback after reports showed business investment rose in the final three months of 2010 and an index of leading indicators increased in December. AUD Private Capital Expenditure q/q came out weaker at 1.3% vs 6.9% previously.

Technical Outlook:

EUR/USD: The Eurusd surged near 1.3784 levels over inflation concerns and post Trichet's statement. Industrial New Orders m/m improved to 2.1%. Daily stochastic is showing overbought levels. Looking ahead today, German Final GDP q/q expected stable at 0.4%. Immediate resistance comes at 1.3800 while immediate support is seen at 1.3680 levels. EURINR (62.31) exporters can cover partially near 62.50 levels for March exposure and importers can cover near 61.00 levels. EUR/INR is likely to trade in the range of 62.15 - 62.45 today. Short term: Slight bullish and Medium term: Bearish.

GBP/USD: The Sterling jumped towards 1.6274 levels as BoE minutes unveiled that one more member favored for rate hike. Daily stochastic showing downside movement. Immediate support is at 1.6130 (Daily 21 Middle Bollinger) while resistance comes at 1.6275 (21 upper Bollinger in daily chart). GBPINR (73.37) March month's exporters should partially cover above 73.50 levels and importers hold for cover below 72.00 levels. GBPINR is likely to trade in the range of 73.20 - 73.50 levels today. Medium term: Bearish

USD/JPY: The JPY extended its gains for the second consecutive session to trade near Y82 levels. Daily Stochastic is showing oversold levels with some chances of upside momentum. Immediate Support is at key 82 levels while immediate strong resistance is at 82.34 levels (H4 21 Lower Bollinger) followed by 82.75 (200 H4 EMA). Yen Exporters are suggested to book March month's exposure partially at current levels and Yen Importers can cover their exposure above 83.00 levels. Medium Term: Maintain Bearishness

AUD/USD: The Aussie surged towards 1.0068 levels after commodities rallied over Middle East concerns. Private Capital Expenditure q/q declined to 1.3%. Daily stochastic is showing downside movement and strong resistance is at 1.0160 levels with support at 1.0010 levels. Exporters are suggested to book March month exposure partially near 1.0150 levels and Importers can cover their exposure on dips. Medium term: Bullish

Gold: The yellow metal had made a high at $1416.80 levels as world stock markets fell and crude oil rose to new two-year highs over global worries. Immediate support for gold is near $1400 levels followed by $ 1391 while immediate resistance is at $ 1431.28(05/12/2010) levels. Medium term: Maintain bullishness.

Dollar Index: The US dollar index is trading at 77.19 levels, down by 0.27% despite .S. markets declining for two consecutive sessions followed by rise in existing home sales to an eight month high at 5.36M. Market will be focused on market mover's data like Unemployment Claims and New Home Sales which are likely to improve. Immediate support comes at 77.13 levels (4 hourly lower Bollinger) while resistance at 77.60 levels (4 Hourly 21 EMA). Medium Term: Slight Bullish

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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