The Greenback was weak against majors as the dollar index had fallen to 78.10, lowest level seen since November 22. The Euro saw decent gains last Friday post better IFO data and was trading above 1.36 levels for the first time since November 23. Spain announced a partial state takeover of its debt laden banks, forcing them to become conventional banks and look for stock market listings. Looking ahead due today, EUR Flash Manufacturing PMI and Flash Services PMI. Australia PPI q/q declined to 0.1% vs. previous at 1.3% giving signs of easing inflation. GBP finally managed to push back near the 1.60 levels post last Friday's UK retail sales falling to 0.8% in Dec. Canadian retail sales rise 1.3% in Nov. USD/JPY pair was steady in a quiet session trading around 82.75 levels. Asian currencies are trading mixed today.
EUR/USD: The Euro currently trading at 1.3611 levels. Looking ahead today German Flash Manufacturing PMI and Industrial New Orders m/m expected better. Immediate support comes at 1.3576 (daily Fibo) while resistance comes at 1.3620 levels (H4 Upper Bollinger) and 1.3695(Daily Upper Bollinger). EURINR (61.95) exporters should cover at current levels and importers cover for Jan and Feb at dips. EUR/INR is likely to trade in the range of 61.80- 62.20 today. Short term and Medium term: Neutral to Bullish
GBP/USD: The Pound is currently trading at 1.5968 levels sustaining near 1.60 levels. Immediate support comes near 1.5942 (Weekly 100 EMA) while resistance at 1.6045 (H4 Upper Bollinger) followed by 1.6110 (Daily Upper Bollinger). GBPINR (72.78) Exporters should partially cover at current levels and importers cover partially for Jan towards towards 71 levels. GBPINR is likely to trade in the range of 72.65 - 72.95 levels today. Short Term and Medium Term: Neutral to Bullish
USD/JPY: USD/JPY is steady trading near 82.70 levels. Immediate resistance is at 82.83 levels (Daily 55 EMA) followed by 83.25 (100 Daily EMA) while immediate support is at 82.60 (Daily Middle Bollinger).Yen Exporters 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 is currently trading below the parity levels near 0.9880. PPI q/q came weaker at 0.1% vs. 1.3% previously. Immediate support comes at 0.9825 levels (Weekly Middle Bollinger) followed by 0.9800 levels (Daily 100 EMA) while immediate resistance is at 0.9917 levels (55 Daily EMA). Exporters are suggested to book Jan and Feb month's exposure towards 1.0000 levels, and Importers can cover their exposure near 0.9800 levels. Medium term: Bullish.
Gold: Gold is currently trading near 1351.00 levels after making a low of 1337.41 levels last week. Support for gold is near 1342.92 levels (21 Weekly EMA) and immediate resistance is at 1355.45 (100 Daily EMA) followed by 1371.11 levels (21 Daily EMA). Buying on dips is recommended. Medium term: Maintain bullishness.
DOLLAR INDEX: Dollar Index is currently trading at 78.12 levels after falling to 78.10 last week. US bonds had rallied by around 4bps despite the cost of 5 year CDS on the US debt hovered near 11 month highs of 51bps. Immediate Support seen at 77.91 (Daily Fibo) levels and resistance is at 78.59 levels (Daily Fibo). Medium Term: Neutral
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.