India Forex Advisors / Market Commentary /31_Mar_2011

By @ibtimes on

Dear reader,

Global Markets:

The Dollar is weak as investors seem to be searching for riskier trades. US ADP Non-farm employment change came out better at 201K vs. 208K previously. EUR continued to be driven more by ECB expectations than peripheral debt woes. GBP jumped on the back of strong GBP CBI Realized Sales data which came out at 15 vs. 6 previously and GfK Consumer Confidence came out stronger at -28 vs. the expectation of -29. Japan's Industrial Production was stronger than expected in February rising by 0.4% and average cash earnings y/y came out neutral as expected at 0.3%. The Aussie currently is trading above 1.0300 levels. AUD Building Approvals m/m came out weaker at -7.4% vs. the expectation of 4.2% and Retail Sales m/m came out positive at 0.5% vs. the expectation of 0.3%.

Technical Outlook:

EUR/USD: Euro 1.4140 continued to be driven more by ECB expectations than peripheral debt woes. Immediate resistance is at 1.4266 while immediate support is seen at 1.4109 levels followed by 1.4089. Daily Stochastic is showing upside movement. EURINR (63.14): Exporters can cover partially at current levels for April exposure while importers can cover near 62.60 levels and further on dips. EUR/INR is likely to trade in the range of 62.85 -63.25 levels today. Short term: Slight bullish and Medium term: Bullish. Further today, German Unemployment Change expected to improve

GBP/USD: Sterling (1.6088) rallied on the back of strong data and positive markets. CBI Distributive trades jumped to 15 vs. 6 previously in March. Support is seen near followed by 1.6052 followed by 1.6017 and resistance is seen near 1.6117. GBP/INR (71.89) exporters should cover near 72.25 regions and importers can cover near 71.65 levels and below. GBPINR is likely to trade in the range of 71.70 to 73.00 levels today. Short Term: Slight Bullish and Medium term: bullish

USD/JPY: The yen again underperformed as the pair rose towards 83.21 levels as expectations grew that Japan will lag euro zone and U.S. central banks in raising interest rates. Manufacturing PMI declined to 46.4 vs. 52.9 previously. Daily Stochastic is at overbought levels with strong resistance is seen at 83.43 and 83.60 regions while downside movement will be supported near 82.05 - 82.41 regions. April month Yen Exporters are suggested to book exposure partially near 82.35 levels and below while Yen Importers can cover their exposure near 83.25 - 83.55 areas and above. Short term Bearish

AUD/USD: The commodity currency was trading steady above 1.3000 levels after better economic data. Retail Sales m/m increased to 0.5% vs. 0.4% expected. Support is seen near 1.0215 - 1.0277 areas which if broken can take the pair towards 1.0185 areas while resistance is at 1.0361 levels. Exporters are suggested to book exposure partially at current levels while Importers can cover their exposure near 1.0150 regions. Short Term: Bullish Medium term: Bullish.

Gold: Buying was again seen in the yellow metal as it was hovering near $ 1426 areas after making a low at 1411. Daily Stochastic is showing slight upside momentum. Support regions are strong at 1420 - 1422 levels while Resistance is seen near 1428 and 1443 areas. Medium term: Bullish.

Dollar Index: The dollar was softer as risk sentiment continued to improve and investors searched for yield. Employment data of ADP was slightly lower at 201K as against expectations of 208K. Support is at 76.05- 76.15 regions while immediate resistance is at 76.16 - 76.20 and further towards 75.86 regions. Short Term: Bearish and Medium Term: Bullish. Today, Unemployment Claims expected to decline slightly and Chicago PMI to remain stable.

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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