Mohammed Rabbani
Friday, June 4, 2010
EUR USD Touching New Lows
Mohammed Rabbani
Friday, May 14, 2010
EUR/AUD crosses remains under pressure touching life low
Tuesday, May 11, 2010
Euro plunges on the Greece rescue package
Tuesday, April 27, 2010
AUDUSD choppy for the month
The AUDUSD pair has been extremely volatile for the month of April making the 18 months high for the month. AUD started rising at 0.9150 for the month reached at the high of 0.9386 (18 Month’s High) currently trading at 0.9386. This month’s Reserve Bank of Australia (RBA) decision to increase the rate hike to combat the inflation was in expected lines for the AUD. The contribution to the volatility was the Goldman Sachs storm which had an impact on the currency pair inline with other majors. On the other hand the Australia’s Westpac’s leading economic indicator rose highest in 1 //2 years from 0.4% to expected figure of 0.5%. The Australian Producer’s price Index which is a leading indicator of Consumer Inflation was expected at 0.7% but came out at 1% from the previous figure of -0.4%. The Australian Central bank’s Governor Glenn Stevens indication on interest rate hike could be on the cards which could be worrisome for the inflation ridden economy. But the RBA’s confidence on the strong Asian partner China, which is the largest importer of its mining activities could boost further trading activities for the economy.
From the technical perspective, the pair seems to be nearing the support with Relative Strength Index (RSI) approaching 30 and could be good point of comeback for the pair. On the Fibonacci level’s it has currently been trading at more than 50.00% of the upward movement, if it breaks the 61.8% level 0.9222, there could be further downside in the pair with next support at .098162. The Australian Consumer Price Index, New Home Sales data and the Private Sector Credit could determine the further move for the currency pair.
Mohammed Rabbani
Thursday, April 15, 2010
AUD recovers after a correction against the USD
Mohammed Rabbani
Wednesday, April 7, 2010
Oil steady at 18 months high
The ADP Non-Farm Employment figure Shed 23000 jobs whereas it was expected to gain 40000 jobs for the month of march which is again concern for the US recovery. The initial jobless claims also decreased by 6000 from 445,000 to 439,000 beating expectation which was at 440,000. On Friday, the US Labor Department said employers had created 162,000 new jobs in March, the highest monthly number since March 2007 which again a positive news for the US economy.
The recent indicators reflect the steady and more positive recovery coming for the global economy which can improve the oil consumptions. The US crude oil inventories also showed a sharp fall from 7.3m barrels to 2.9m barrels however above expectation of 2.4m Barrels. Other reasons for the commodities price rise is the European Union’s bailout plan for Greece which again can boost consumption overall. The Weak dollar is also contributing towards the commodity price rise.
From the technical point of view, it has broken the resistance of 82.84. The next resistance can be at 92.15 as it has crossed the 38% of the upward movement. On the downside the 75.03 can be the support for the month, if it goes below then support can be placed at its can go up to 70.83.The US Crude oil inventory data and the unemployment data to be released today should be watched out which could direction on the rising oil prices. The Monetary Policy Committee (MPC) and the Bank of England’s (BOE) Interest rate statement for GBP which is expected to boost the GBP currency can also be a gain for the overall consumption.
Wednesday, March 31, 2010
Nifty touches 5300 and sees a correction
HCL Tech, HDFC Bank lost more than 3% yesterday, Ambuja Cement, Sun Pharma, Garsim, and Hero Honda lost more than 2% from Mondays close. On the other hand there was major buying happening DLF and TATA motors which was up 3.23% and 2.23% respectively. IT stocks continued to struggle, IT companies which is major contributor to India50 index lost nearly 2.53%. The appreciation of rupee which is at a 19 months low at 45 against the US Dollar was also building pressure on IT companies. Though the nifty closed in red losing 0.76% from Mondays close, Asian indices were in the green zone. Shanghai composite gained 0.65% closing at 21,374.79 and Nikkei gained 1.01% closing at 11,097.14.
Thought the psychological level of 5300 has been broken and closed below for the day; the bullish outlook of the India Inc could hit the peak of 5350 in near term. With earning season in coming weeks, the nifty is at very crucial level facing resistance at 5350 in the near term and support at 5183. The support level could be a crucial level to watch as it has seen an upside twice from these levels. This NSE nifty futures expiry can bring some more correction happening for the week. IT could be sectors to watch for which can affect the Nifty in near term.
Thursday, March 25, 2010
USDCAD on a Low since July 2008.
The US dollar plunged to an eighteen months low against the Canadian dollar at 1.0061. The Canadian dollar has been on bullish trend as there has been huge purchase of CAD denominated assets. The value of stocks, bonds, and money-market assets purchased by foreigners rose from 7.75bn to 11.83bn which is also higher than the February figure of 11.23Bn which is a definite plus for Canada. Also unemployment rate of Canada fell from 8.3% to 8.2% which was expected to remain steady at 8.3%. The Treasury International Capital (TIC) long term purchase data for the US which shows purchase of the US assets came far below at 19.1bn from the expected figure of 50.3Bn. These could be signals of the two major purchasers Japan and China looking for alternatives markets like CAD for making their investments purchases. The Consumer Price Index (CPI) which shows change of prices and services purchase by consumers accelerated from 0.1% to 0.7% more than the expected figure of 0.3%. The Lending Index which reflects the combined reading of economic indicators which reflect the overall performance of Canada advanced from 0.7% of January to 0.8% but was below the market expectation of 0.9%. On the other hand the building permits data for the US almost came out equal to the forecast at 0.61m however dropped from 0.62m of previous month’s figures. Producer Price Index (PPI) also drops highest in past 7 months from 1.4% to 0.6% which can be are signs for US recovery measures. However the unemployment claims for US also came out higher than the expectation at 457K from the expected figure of 456K which is an important data that reflects US economic recovery.
From the technical point of view, for the past week it has been trying to face the resistance at 1.0287, if it breaks this resistance level, next resistance could be placed at 1.0362, the near term support is at 1.0148. The crude oil inventories data and the natural gas storage data which affect the currency pair is expected to rise. The Bank of Canada is expected to comment on the overall outlook of the Canadian economy and there is speculation that there might be an interest rate hike. Though USDCAD touched the low of 18 months low, there has been a modest recovery seen for the week giving indication of US markets picking up. If the US continues with the same pace or a better rate of growth, USD can see an uptrend in near future.
Mohammed Rabbani
Monday, March 22, 2010
USDJPY indecisive and volatile
Currently, the JPY is facing a resistance at 91.13, which has not been broken during the month and the near-term support at 89.67. Japan’s monetary policy scheduled to be released this week will give investors the outlook on overall economic performance for JPY and also how the monetary policy would be in future to control deflation. Tokyo’s Core Consumer price Index (CPI) and the National Core CPI publications should be watched by investors.
Mohammed Rabbani
Friday, March 19, 2010
Thursday, March 18, 2010
EURUSD recovers during the week
Euro has made a strong recovery this week from the low of 1.3639 against the US Dollar. Euro has been struggling for months now due the Greece debt tribulations but Euro Zone countries agreed to assist Greece. The Euros recovery can be attributed to the French Industrial Production data which gained 1.6% from the previous low of -0.2% which is a major contributor to the Euro Zone. However, Germany’s, Trade balance was forecasted at 16.4bn Euros versus published 8.7bn Euros from the previous of 16.6bn Euros, which could be pulling down the EUR against the USD. The statement of the Fed Chairman Mr.Ben Bernanke to keep the federal fund rate low near zero for “extended period” didn’t lure the markets and investors. On the other hand, US Trade Deficit came down to $37.9B from the previous of $39.9bn. This6.6% decline could be a good signal for the USD in the near term. The Core Retails Sales data for the US was better than expected which was a 0.3% increase, showing indications of economy picking up. European Central bank president Mr. Jean Claude Trichet has positioned confidence on the rating agencies that they would not cut the Greece’s credit rating and has faith on Greece government measures to tackle the issue. However the German ZEW Economic Sentiment index expected was 43.5% which dropped to 44.5% for the month from the previous figure of 45.1% shows the Euro Zone continues to struggle in front of the US positive recovery measures.
Greece is yet to come out with the clear roadmap on the austerity measures to tackle with the budget gaps it is suffering. Investors should watch out for US Producers Price Index, Unemployment Claims data and the EUR Current Accounts data for the week which could have serious impact on the traded pair. From the technical perspective, there is at a very crucial level at 1.3791. The near term resistance for the Euro could be placed at 1.3849. The Support stands at 1.3643.
Mohammed Rabbani
Monday, March 15, 2010
Australian Dollar continuously gains against Euro
From the technical point of view, the near term support would be at 1.4923 and next support at 1.4875. The resistance would be at 1.5042 and next resistance at 1.5109. Investors should watch out for AUD monetary policy meeting and the Germany’s economic ZEW Sentiment data release (March 16) which could affect the pair. However from the trend perspective, the EUR continues to remain bearish against the Australian dollar.
Mohammed Rabbani
Friday, March 12, 2010
JPY plunges against the dollar
From the technical point of view the near term support would be at 90.29 with the next support at 89.89. From the upside 90.75 is the near term resistance and if it continues to appreciate the next resistance level is at 91.12. Other than the U.S macro news, the BOJ press conference would be important for investors trading on the Yen.
Mohammed Rabbani
Mohammed.rabbani@xtb.in
XTB India