Tuesday, January 14

Asad Rizvi

It was JPY that was due for correction made gains against the US Dollar. US 10-year bond gain yields was a big supporting factor that helped Japanese currency to rise after surprise fall in US NFP numbers. JPY gain is not very surprising, as I have been hinting in my posts since last 10-days that Yen is due for correction and it cannot continue to take beating in a hope that Japanese government will be soon making stimulus announcement. Now they have to act, such verbal statements will be less effective.

In another interesting move US 10-year bond yield has gained substantial strength upsetting Bullish view after the release of US Payroll data in a hope that FED may slow the pace of tapering. This could be an effort by major bond players to bring change in sentiment, but may not the reality, as one or two weak data will not help to change the policy. If we look at the recent release of US economic data in boarder perspective then overall US economy is doing well and poor Payroll data is just one bad event. In an immediate response after the release of bad Payroll data the two FED officials have already focused on continuation of FED ongoing FED's strategy, its two other official Plosser and Fisher are due to make speeches, they will provide more direction.

Today's release of Retail Sales will be one of the major data announcement of the week, which should guide market for its next move during rest of the week.

GMT 3:44 - GOLD @ $ 1252 = I do not see gold stretching beyond $ 1254-56 and would prefer selling. Needs to push below $ 1247-48 for a test of $ 1240-42 or else $ 1258-60.

GMT 3:58 - EURO @ 1.3662 = Euro has resistance around 1.3690-95 and may hold, but is required to push below 1.3625-30 levels for 1.3580-90 zones or else could retest the resistance level or else 1.3720.

GMT 4:03  - GBP @ 1.6386 = Cable may struggle to move beyond 1.6425. A fall below 1.6310-15 will see more losses. Or else 1.6455.

GMT 4:07 - JPY 103.47 = JPY is required to move beyond 103.70-90 levels for a move towards 104.40, which looks difficult as it can potentially make another attempt to test 102.50-80 zones.

GMT 4:11 - AUD @ 0.9033 = We may have seen the top and Aussie could exhaust around 0.9060-65. However, as long as 0.8970-80 holds, it could make another small up move. Break of 0.9090-00 will threaten for more AUD gains.

 

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.