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FED’s Bullard hints QE unwinding – Yen to Gain, Gold to Melt – June 12

June 12, 2013
Interaction with my Subscribers during the day…………
 7:53 AM  sir shall go short gold at 1379-80??7:54 AM  I will stick to my view……………..

8:49 AM  sir short gbp at 1.5670 or wait??

8:53 AM  My view on Cable in unchanged. Now have to decide the entry level……

 9:34 AM  sir shall go short aud with stops 0.9590

9:36 AM  I m expecting tests og 0.9550-60……

12:43 PM  SIR SHORTED AUD AT 0.9560.. WHERE TO BOOK PROFIT?

12:45 PM   AUD @ 0.9525 = Book now, around 0.9515-15………………….

1:53 PM  GOLD @ $ 1383.50 = the exp[ected up moce has occured book your profit around currenct Levels and go short with STOPS $ 1391….Cheers

2:37 PM   hi sir, Long in Euro and Bought YEN… Where to close the positions ?

Thanks
 2:43 PM   JPY @ 96.05 = I was waiting for a test of 95.75 to give signal for profit taking. Today there is US bond auction & we could see both way volatility in Yen. I think plan out a strategy and book profit………

2:45 PM  EURO @ 1.3330 = I am still looking for upside break of 1.3345-50 will encourage for a test of 1.3370-75…….

2:54 PM  GOLD @ $ 1395 = Sell raound $ 1395-97 Stops $ 1403
2:59 PM   GBP @ 1.5687 = book your profit around 1.5687-93

3:04 PM  Ok pals, if sold Gold around $ 1395 Do apply STOPS @ 1403. Book your profit around $ 1382-85. Break Of $ 1377 will trigger fall…….

Cheers until tomorrow……..

With market in search of news item for next move, FED voting member Bullard has given a hint that how FED will start unwinding its bond purchase program. He prefers rolling back with Mortgage backed securities and stick to Treasury ranging between USD 10-20 billion. Out of 85 billion monthly bond purchase, the split is Treasuries $ 45 billion and Mortgage backed securities $ 40 billion. Interestingly to arrest volatility he countered by saying that low inflation could extend/delay unwinding. I think FED now surely has a plan and such leakage are intentionally made to prepare the market before the announcement to reduce the possible impact in the market. I will not be surprised if FED has an agenda to talk on this subject in its next week’s FOMC announcement.
In another major event, German constitutional court is busy hearing the court case against ECB’s Outright Monetary Transaction (OMT) program that has brought currency stability, which is not favoured by German Central Bank Chief, as he thinks questions the independence of Central Bank and is in violation of German laws, he also fears potential risk to its tax payers. Perception about the ruling is that it may obtain constitutional clearance, but any sort of conditional tag can cause unrest. German court ruling is expected around 10 GMT. We could see EURO making final upside dash after the court announcement unless there is  negative ruling, which should in meeting my weekly upsie target before Euro is knocked down once again.
While, Japanese Yen enjoyed its continued strength in the absence of policy adjustment as BOJ did not extend the duration of fixed rate funding period to 2 years or beyond from current, which is capped under one-year, neither announced additional liquidity. BOJ probably is giving more time before it next line of action, as it may want to asses the impact of its loose monetary stance.
Twitter     @ asadcmka    for Currencies & Gold Update……
GMT 3:10 – EURO @ 1.3310 = Eruo could take a small dip in early Europe, but has support around 1.3250-60 levels. We see another surge towards 1.3370-75 zones., with mild possibility of a move that could stretch up to 1.3430.  Or else test of 1.3220-25.
GMT 3:15 – GBP @ 1.5640 = Strong support is around 1.5590. Cable needs to push beyond 1.5680-90 zones for a test of 1.5715-20 levels or else 1.5550.
GMT 3:21 – JPY @ 96.50 = Yen will remain choppy and in demand, as buying of Japanese currency interest could be seen around 96.80-90 zones for another attempt towards 95.10-20 on break of 95.70. However, break of 97.80 could further weaken JPY.
GMT 3:24 – AUD 0.9470 = More Aussie gain is possible, as long as 0.9420-40 zones holds, but profit taking is possible around 0.9530-50 zones. failure to break above 0.9580 risks for another drop.
GMT 3:30 – GOLD @ $ 1377.50 = Gold should exhaust around $ 1381-83 zones. see risk for another test of $ 1370 levels. Break of $ 1365 will see a fall extending $ 1350 on break of $ 1358. Or else $ 1388-90 before down again.
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