Skip to content

CHiNESe PMI, GrEEce, SpAiN & PooR uS DaTa HaMMerS u$d

December 4, 2012

Unresolved US fiscal cliff issue is still a matter of big concern for the world financial market looking for next major direction. Final announcement it will clear the market liquidity position that includes tax relief and as well as spending, which should have big impact on the market activity.
Yesterday, in the early hours market sentiment got the lift from Chinese manufacturing purchase index (PMI) helped by quite a few positive events in Europe that had also helped Euros gain. In Europe, the mood was turning bullish after the news of Greece rescue package that was supported by some of the positive comments by German Chancellor Angela Merkel.
European currency got further lift on after Credit Sussie announcement of setting Negative SFR deposit rate, which means that it will charge its customer to hold CASH Swiss Franc. Basic idea behind the announcement of negative return is to discourage investment is Swiss Franc or in Swiss instrument that offers negative or no return or to have “Capital Control”. This news supported EURO as it will discourage investors shifting funds from Euro to SFR.
Euro got further boost after the release of US manufacturing activity data (ISM) that fell below the benchmark level of 50 pct to 49.5 pct after October reading of 51.7 pct. But Euro though could not make big leap maintained its firm tone after another major announcement that Spain has formally made a request for assistance of its ailing banking industry for 36.5 billion Euros for the “Bad Bank” that could be released next week.
However, despite current ongoing developments, market will move cautiously as long as two sides does not resolve the fiscal issue. There is still a big threat that disagreement or lingering of fiscal issues could lead to uncertainty and ciaos. US non-farm payroll was another important event of the week. FED will be meeting on Dec 11 and 12, apart from buying of monthly mortgage bonds, extension of Operation Twist will be discussed. So nothing is over, as there is plenty in the pipeline yet to come. Euro could still get some more lift before it gets exhausted.

GMT 3:30 – EURO @ 1.3050 = will find support around 1.3020-25 zones and needs to fall below 1.2980 for resumption of down move, as see risk for test and break of 1.3090-95 foe 1.3110-15

GMT 3:43 – GOLD @ $ 1713.50 = Though looking soft, but should hold $ 1718 for $ 1708 on break of $ 1712. Or else $ 1725. Trade with care. tricky today
GMT 3:40 – AUD @ 1.0446 = Should hold 1.0485-90 levels, but needs to push below 1.0370-80, which is a very strong support level and has the ability to bounce back, if dip buy with STOP 1,0340. Break of upside resistance could see surge and test of 1.0550
GMT 3:37 -JPY @ 82.09 = No chang in view. yen to make gains 82.35-40 is ideal level to buy Japanese currency, as requires to fall below 82.70 for more weakness, break of 81.75-80 will encourage for test of 81.50-60 levels. Target 80.80 is intact
GMT 3:34 – GBP @# 1.6101 = buy around 1.6080 STOPS 1.6060 for 1.6135-40

Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: