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Watch out for big Moves in Gold & Currencies – Feb 20

February 20, 2013

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GMT 3:21 – Euro @ 1.3412 = ZEW was another supportive economic data released from Germany that gave confidence to the market participants that Europe looks well on its way to recovery and is likely to avoid recession. Today, release of German CPI and PPI data will provide more clues about the progress, as better numbers will give more confidence to the neighbouring economies that are struggling to make a comeback.Similarly, UK’s national Statistics will be releasing couple of data’s related to spending and labor market condition in UK, but market will be more keen in the BOE’s minutes, as Pound Sterling is struggling for more ideas. 
This will be followed by release of Building Permits and PPI in USA, as both the economic data will provide guideline about the progress US economy is making. But more importantly FED’s Monetary Policy Committee minutes could be the real market mover. The key language that market will try to dig out is that how serious is FED and if so then when and how does it plan to get rid of its quantitative easing program. Though QE exit plan could be too early to discuss because jobs numbers are trailing behind the target.
EURO @ 1.3412 = In Asia and early Europe, I am expecting 1.3370-80 to hold, but 1.3450 will be tough to crack. Onwards, 1.3480-90 is the key levels that should not surrender or else Euro could enter the Bullish territory. Once 1.3340 surrenders on the downside, which is a favoured move Euro will enter a neutral zone to trade in 1.31-35 band.
GMT 3:29 – GBP @ 1.5444 = Pound Sterling will trade in 1.5410-70 ban until data. 1.5510 is required to break for test of 1.5550-80 zones. However, a fall below 1.5370 will open gates for more losses.
GMT 3:31  – AUD @ 1.0351 = This is surprise up move for me, but still needs to clear 1.0380-90 zones for more gains. However, I will not be surprised to see sell off at the highs.
GMT 3:38 – JPY @ 93.50 = One-sided momentum has certainly broken, Japanese currency has potential to correct 93.80-90 and may not surrender as it should continue to make corrective move at snails pace with occasional pop-up. Next level is 93.02-10 before down then up again for 92.83. So keep taking your profit. On the upside next challenging level is 94.50.
GMT 3:56 – GOLD @  $ 1608 = Choppy day is expected. $ 1602-04 should hold, with risk for a move towards $ 1612-16 zones. The big number to watch today is $ 1625-30 zones. But fall below $ 1594-96 levels in late hours will encourage for bigger slide.

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