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MoNeTary PoLicY AnNoUncEmEnT – AuSTRALia-CaNaDa-MaLaWi-UgAnDa

December 5, 2012

GMT 3:20 – EURO @ 1.3107 = Since there is no news from US on fiscal cliff yet, market is watching Central Banks behaviour globally. While, Malawi had to raise its interest rates by 400 basis point to defend its currency, Uganda slashed its rate for the 9th time this year to stimulate its ailing economy.
But Bank of Canada’s policy rate announcement to maintain its rate that was kept unchanged for 18th consecutive time was a bit of surprise as market was expecting hike as BOC ‘s was hinting tighter stance, but some of the weak pockets in quarter 3, specially caused by the energy sector may have been the hindering factor.
Earlier in the morning Reserve Bank of Australia announced lowering its benchmark rate to 3 pct, last seen in 2009, probably to support its mining sector that was particularly mentioned by RBA Governor, which means that other area’s are doing fine. This may have given hope to Aussie bulls that no more cut for the time being that saw Australian currency surging. If we compare Aussie rate with the developed economies the 3 pct rate is still too attractive with favourable interest rate differential as Europe remains suspect and US fiscal cliff is also giving shiver to the investors. Australian economy is also fairing well and most recently China’s economy have played the pivotal role for the Australian currency. And lastly not to forget that global Central Bank buying is a big supportive factor that provides support to Aussie on dips.
Meanwhile, this week two more monetary policy announcement from Bank of England and ECB is due on Thursday, which is not likely o give any surprise.
As US fiscal cliff continues to linger on and as reaching agreement does not look possible this week, all eyes will be on today’s ADP report as market will try to asses job condition that could be distorted due to Hurricane Sandy. However, this number will be used as guesswork For Friday’s payroll data.
Prior to US economic data there are many other data release but that may have minor impact on the market and hence, I am expecting Euro to find a cap today. Moody’s warning to Europe about growth means job condition will not get better in near term with unemployment in Spain and Greece already over 25 pct the pressure will stay.
EURO @ 1.3105 = I will be extremely cautious around 1.3120-30 zones ad prefer selling the European currency, as only break of 1.3160 will open gates for 1.3250. However, I am expecting a pull back but needs to push below 1.2940 for test of 1.2905
GMT 3: 34 – GOLD @ $ 1702.50 = Pick the top around $ 1703-06 to sell the Yellow metal. Today gold is required to penetrate beyond $ 1711-12 level for more gains, as I am expecting another assual towards $ 1695 zones
GMT 3:30 -JPY @ 82.30 = I will sell Japanese currency around 82.32-38 STOPS on break of 82.65-70 for re-test and break of 82 levels.
GMT 3:26 – AUD @ 1.0471 = Mildly bearish prefer picking top beyond 1.0480 levels with STOPS 1.0525 for a test of 1.0425-25 zones
GMT 3:24 – GBP @ 1.6105 = May struggle around 1.6115-20 and should hold below 1.6140-50 zones for test of 1.6072-77 levels

GMT 7: 10 – GOLD @ $ 1705.20 = Could stretch up to $ 1707-08
GMT 11:58 – EURO @ 1.3075= Book your profit around 1.3070-75. Cheers
GMT 12:11 – (Subscriber) usd/jpy where should book profit?
GMT 12:22 – Around 82 !
GMT 12:39 – (Subscriber) Hi sir, Do u suggest buying of EUR at these levels or go short again at TOP? Thanks
GMT 12:41 – EURO @ 1.3070 = Prefer to pick the top. However, would buy Euro around 1.3045-55 zones STOPS 1.3010. Should struggle around 1.3095-00
GMT 13:26 – after data view remain same or change ?
GMT 13:28 – I will wait to pick the top to sell EURO around 1.3095
GMT 14:12 – GOLD @ $ 1696.20 = If holds below $ 1698-00 for next 10-15 minutes, we may a fall below $ 1695 to test $ 690-92 zones
GMT 14:14 -(Subscriber) gold will break 1695 where suppot what to do in gold
GMT 14:16 – plaese don not sleep. I have posted my view on gold about 4 minute ago
GMT 14:59 –
Ok pals, end of another perfect day.
Suggest squaring of all positions.
Prefer picking top to sell Euro. Cable could make small recovery. Gold could make a mild bounce back.
Cheers unti tomorrow……….

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