Crude oil future (March) prices witnessed a rally on Wednesday’s trading session and after making a high of 3707 it settled at 3689 levels.
It’s sjown a stiff resistance at 3730 levels on breach of the same likely to trade higher. The supports are at 3660 then 3630 levels.
We at fxcommodity expect prices to trade sideways to higher and recommend buying near support levels.
MCX Crude Oil Tip
Buy March at 3675
Tgt 3720
SL 3650
Popularity: 35% [?]
Feb 17
Technical Recap
Bulls really controlled the action last week beginning with a boost off of the 200-day moving average followed by reinforced settlements above the crucial $72.50 benchmark area. Prices trended higher for the week through Thursday to $75.70 before pulling back on Friday on a round of profit taking ahead of the 50 and 100-day moving averages. The market closed firm on the week just above the 7-week dowtrend channel at $74.00 level with a minor uptrend potentially developing early this week.
We are still maintaining settlements below the broken key longer term Quarterly trend lines at the $77.00 to 78.00 range leaves the market vulnerable to renewed selling. With options expiration on Today (Wednesday), we anticipate rallies early this week, and then begin fade against $78.00 to 80.00 leading to a turnover later in the week.
Technical Outlook
Upside:
The market reversed the 7-week downtrend to start the week off rallying off the $74.00 level on Tuesday. Maintaining settlements above $74.00 to 75.00 supports advances this week targeting the key broken Quarterly trends in the $77.00 to 78.00 range. Trade or settlements above $78.00 brings the $80.00 psychological mark easily in range for the week. Any settlements above $80.00 will provide solid Bullish reinforcement with the potential to propel the market back to the Jan 2010 highs at $84.00. If momentum fades out in the $77.00-78.00 range, longs should cover all positions.
Downside:
Failing rallies at the $77.00-78.00 range generates a sell signal for an initial drive back to the broken 7-week downtrend at $74.00. Settlements below $74.00 reinforces short term weakness as it puts prices back the weekly downtrend channel while violating the minor daily uptrend. The objective below $74.00 is placed at the key $72.50-71.75 Support range where shorts should initially scale back positions. Trade and settlements below $72.50-71.75 will rekindle sustainable Bear forces triggering sell offs targeting the current 2010 lows at $70.00 to 69.50 while bringing the next major objective in range at $68.50-68.00. A settlement below $70.00 on the week, or trade that takes out the $68.00 level, lines up for $65.00 oil in the coming weeks.
Whats Making the News
Popularity: 31% [?]
Feb 3
€
The euro appreciated vis-à-vis the U.S. dollar today as the single currency tested offers around the US$ 1.3965 level and was supported around the $1.3885 level. The common currency gained some ground on news the European Commission will support Greece’s deficit-reduction program that will be published tomorrow. Greece’s budget deficit was 12.7% of GDP last year and is struggling to convince the markets it can bring that down to 3% by 2012. Greek debt is now trading at a massive 400bps premium at the ten-year level over German bunds, the highest level since 1998. Most traders expect the European Central Bank will keep monetary policy unchanged on Thursday. Data released in the eurozone today saw EMU-16 producer price inflation up 0.1% m/m and off 2.9% y/y. Also, January PMI construction improved to 48.6 from 47.1 and German December retail sales were up 0.8% m/m and off 2.5% y/y. Some dealers were spooked into selling the euro last night after Reserve Bank of Australia surprised the markets by not raising interest rates last night on the premise that higher-yielding currencies like the Australian dollar could be weaker.
In U.S. news, traders will pay close attention to testimony today from former Fed Chairman Volcker who will indicate hedge funds and private equity funds should be allowed to profit and fail. Volcker is also a proponent of limiting the size of banks so that none are “too big to fail” and create unmanageable systemic risk. Data released in the U.S. today saw December pending home sales print as expected at 1.0% m/m and up 10.5% y/y. Tomorrow’s data will include MBA mortgage applications, January Challenge job cuts, and January ISM non-manufacturing data.
The big news this week will be Friday’s January non-farm payrolls data.
Euro bids are cited around the US$ 1.3740 level.
¥/ CNY
The yen appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥90.25 level and was capped around the ¥90.90 level. Finance minister Kan urged Bank of Japan to continue implementing “appropriate and flexible policies” and work closely with the government to combat deflation.
Kan also said “it is possible that the yuan will be one of the agenda items. I will discuss it on the understanding that stable growth in China is desirable for Japan.” Notably, bids fell short of the BoJ’s offer today in its open market operation as part of the central bank’s lending program announced in December. Prime Minister Hatoyama said the budget environment in 2011 will remain “severe.” Bank of Japan Chief Economist Momma yesterday reported “the risk that the Japanese economy will fall off from a cliff is small, but there is still a long way to go. Even if the global economy continues to recover, the spread of that to capital spending and the labour market will be limited.”
The euro moved lower vis-à-vis the yen as the single currency tested bids around the ¥125.80 level and was capped around the ¥126.80 level.
The British pound moved lower vis-à-vis the yen as sterling tested bids around the ¥143.85 level while the Swiss franc moved lower vis-à-vis the yen and tested bids around the ¥85.45 level. In Chinese news, the U.S. dollar depreciated vis-à-vis the Chinese yuan as the greenback closed at CNY 6.8271 in the over-the-counter market, down from CNY 6.8275.
A rumour circulated through the market last night that China will permit the yuan to appreciate after July. People’s Bank of China adviser Fan Gang yesterday reported China’s “real worry” remains asset bubbles that could emerge as China’s economy emerges from a crisis period into a “boom time.”
₤
The British pound moved higher vis-à-vis the U.S. dollar today as cable tested offers around the US$ 1.5995 level and was supported around the $1.5900 figure level. The big question facing traders is whether Bank of England’s Monetary Policy Committee will scale back, pause, or extend its bond purchase program when its monetary policy announcement is made on Thursday.
Many data were released in the U.K. yesterday.
First, January manufacturing PMI improved to 56.7 from 54.6, a fifteen-year high.
Second, December mortgage approvals decreased to 59,020.
Third, net lending to individuals rose by ₤1.2 billion in December. Fourth, Hometrack January house prices were up +0.1%. Cable bids are cited around the US$ 1.5720 level.
The euro moved higher vis-à-vis the British pound as the single currency tested offers around the ₤0.8760 level and was supported around the ₤0.8710 level.
CHF
The Swiss franc appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the CHF 1.0540 level and was capped around the CHF 1.0605 level. There was talk in the European session that Swiss National Bank lifted the euro/ Swiss franc cross to keep a lid on the Swiss franc. Data released in Switzerland today saw the SECO consumer climate indicator improve to -7 from -14. The media this week reported Swiss National Bank is unlikely to abandon its policy to keep a lid on the Swiss franc even though the domestic economy continues to improve. U.S. dollar offers are cited around the CHF 1.0760 level. The euro moved higher vis-à-vis the Swiss franc as the single currency tested offers around the CHF 1.4740 level while the British pound moved lower vis-à-vis the Swiss franc and tested bids around the CHF 1.6800 figure.
Technical Outlook at 1330 GMT (EDT + 0500)
(Bid Price) (Today’s Intraday Range)
EUR/ USD 1.3901 1.3934, 1.3851
USD/ JPY 90.82 90.87, 89.87
GBP/ USD 1.5904 1.5977, 1.5849
USD/ CHF 1.0596 1.0624, 1.0565
AUD/USD 0.8866 0.8877, 0.8787
USD/CAD 1.0645 1.0720, 1.0637
NZD/USD 0.7101 0.7117, 0.7042
EUR/ JPY 125.93 126.68, 125.80
EUR/ GBP 0.8735 0.8760, 0.8708
GBP/ JPY 144.11 145.18, 143.83
CHF/ JPY 85.47 86.02, 85.43
Support Resistance Support Resistance
EUR/ USD USD/ JPY
L1. 1.3795 1.4340 86.95 93.20
L2. 1.3480 1.4495 84.85 95.50
L3. 1.3085 1.4835 82.30 98.85
GBP/ USD USD/ CHF
L1. 1.5755 1.6215 1.0350 1.0830
L2. 1.5355 1.6530 1.0040 1.1045
L3. 1.4950 1.6890 0.9920 1.1315
AUD/ USD USD/ CAD
L1. 0.8755 0.8960 1.0400 1.0780
L2. 0.8555 0.9190 1.0150 1.0960
L3. 0.8225 0.9425 0.9920 1.1140
NZD/ USD EUR/ JPY
L1. 0.6915 0.7295 122.45 128.90
L2. 0.6750 0.7430 118.50 131.50
L3. 0.6585 0.7645 115.65 132.85
EUR/ GBP EUR/ CHF
L1. 0.8500 0.9175 1.4575 1.4875
L2. 0.8320 0.9290 1.4305 1.5010
L3. 0.8190 0.9430 1.4110 1.5450
GBP/ JPY CHF/ JPY
L1. 141.10 149.20 83.35 91.60
L2. 135.85 150.60 81.40 93.60
L3. 129.35 152.20 78.95 97.95
Popularity: 19% [?]
You are currently browsing the archives for February, 2010
Bad Behavior has blocked 21 access attempts in the last 7 days.
