Thursday, December 26

Asad Rizvi

Trading activity is very thin due to holiday season. Volumes will remain low until traders are back after the year end. While, financial market is still trying to digest the FED latest monetary policy announcement to reduce its monthly bond purchase starting from January. 

For guideline, release of US economic data will play crucial role, as market indicator after the FED stimulus decision. On the Christmas eve, durable goods showed healthy jump due to sure in aircraft and transport equipment in the month of November that rose to 3.5 pct versus 2 pct expectation. Home sales too climbed, despite higher trend in mortgage rates. Today' release of US initial jobless claims is another key indicator that will give hint of job market condition. 

Meanwhile, gold is hovering around $ 1200 despite release of better US economic numbers. This due to year end valuation, as I have posted in my weekly report that holders will try to push price higher. Though tug of war between the Bears and Bulls may continue, but this time there is a minor risk that Bears that normally dominates at year end closing time may loose the battle due to strong US economic performance draining of liquidity from next year.

Meanwhile, we are probably heading for another very slow day, as Europe is closed. there could be minor/thin activity in US session. Market could be dead or year end order could create volatility. Unpredictable moves is possible so trade with caution.

GMT 2:41  - GOLD @ $ 1204.80 =  Gold may hold above $ 1198-00 in Asian session to test $ 1208-10 or else $ 1194. Meanwhile, a move beyond could risk for a test of $ 1215-20 zones. 

GMT 2:52 - EURO @ 1.3678 = Euro should hold around 1.3680-90 for 1.3560, break will encourage for 1.3615-20 or else 1.3705-10.      

GMT 2:58 - GBP @ 1.6382 = Strong support is around 1.6350 only break risk for 1.6320 or else potentially if Pound   breaks 1.6410 it could make another 50 pip gain. Though may exhaust below 1.6410.

GMT 3:02 - JPY @ 104.75 = Challenge is around 104.90-00. Japanese currency may not surrender for a test of 104.40-50 zones. Break of 105.25 will threaten for more losses. 

GMT 3:07 - AUD @ 0.8886 = Aussie should hold around 0.8850 for a test of 0.88915-20 zones or else 0.8820.

DISCLAMER : The commentary/information presented is not intended for trading purpose. The idea is to exchange views with the members/readers. Therefore, I accept no responsibility or liability for any losses incurred due to position taking.