GOOD MORNING! STOCKS
Good rallies in Equities worldwide, led by India's rate cut fuelled rally. The bullish possibility remains alive, but further break above crucial near term Resistances is needed to push back the Bears.
The Dow (16284.70, +1.5%) is back up above the crucial 16250 Support. The Dax (9660.44, +2.22%) may have good chances of a Double Bottom, but confirmation is needed in form of a rise past 9800. See the second and third charts on
The Nikkei (17691, +1.7%) is up a second day, having bounced from downtrend Support yesteray. But a rise past 17800-18000 is needed to break the overall downtrend. The Shanghai (3053, +0.48%) continues its sideways consolidation above 3000, but needs to break above 3100-3200 now to avoid a resumption of its longer term downtrend.
Even the Nifty (7948.90, +1.3%) shows possibilities of a Bull Shoulder-Head-Shoulder, but needds a rise past 8000-8100 to dipel any bearish possibilities.
Let's see if the market finds the spunk to move and break the Resistances cited.
Good news in Commodities. The Gold/ Copper ratio (470.5) has fallen over the last couple of days and may have some chances of forming a Double Top.
Gold (1114.50) has come down to test Support at 1110-09 and could be vulnerable to further decline towards 1100. Copper (2.3685) has done well to move up further from yesterday, reducing its downward pressure. Instead, there could be chances of seeing a Double Bottom take shape. Take a look at
Silver (14.55) is near-term bearish for a fall towards 14.00.
Crude (Brent 48.70 and WTI 45.66) continue to move sideways in the near term, within the longer term downtrend that has Resistance near 50 and 48 respectively.
US ADP employment report released yesterday showed that the private sector employment jumped by 200,000 jobs in September from186,000 jobs in August. Dollar trades higher compared to Euro & Yen while it is still weak against the Pound, Rupee and Aussie.
Euro (1.1166) fell sharply after a weak inflation data (Flash CPI) and sagged as the Dollar strengthened further on strong jobs report. It is currently testing support near 1.115 and may see some consolidation in the 1.11-1.125 region. Further direction is unclear for now. See charts: http://www.kshitij.com/graphgallery/eurcandle.shtml#candle
Aussie (0.7047) is trading just below the 13-day MA at 0.7073. But overall near term may be choppy within 0.71-0.69. See charts:
Pound (1.5130) has come down to test important support near 1.5118-1.508 which seem likely to hold in the near term. See charts: www.kshitij.com/graphgallery/gbpcandle.shtml#candle
Dollar- Yen (120.15) is up slightly but overall trades within the 121-119 region. A break on either side would be seen soon. Consolidation may continue for some more sessions. See charts: http://www.kshitij.com/graphgallery/jpycandle.shtml#candle
Dollar-Rupee (65.58) closed above important support at 65.50. If that holds we may see movement in the 65.50-65.80 today.
US yields are trading lower as expected. The 5Yr (1.38%), 10 Yr (2.6%) and the 30 Yr (2.87%) are down from 1.42%, 2.09% and 2.89% respectively. The 10-5Yr yield differential (0.68%) is testing support near current levels and if that holds may bounce back towards 0.70%. See charts: http://www.kshitij.com/graphgallery/usddiff.shtml#sindiff
German 10Yr (0.584%) and 30Yr (1.328%) are also trading lower than 0.605% and 1.342% respectively. See charts: http://www.kshitij.com/graphgallery/eursin00.shtml#sin00
The German-US 2Yr (-0.87%) is testing resistance near current levels and may probably come down towards -0.90% if that holds while the German-US 10Yr (-1.48%) has some room on the upside towards -1.44%. See charts: http://www.kshitij.com/graphgallery/eurusddiff.shtml#eurusd
The UK yields have broken immediate support that we have been mentioning for quite some time and looks bearish in the near term if it does not bounce back immediately. The 5Yr (1.1870%), 10Yr (1.7585%) and 20Yr (2.304%) are all trading lower than 1.22%, 1.799% and 2.33% respectively.
Indian 10Yr GOI (7.539%) has also fallen quite a bit and we may see some pause now before further movement. Possible support seen near 7.50%.
23:30 GMT or 5:00 IST AU PMI
...Kshitij Expn 53.0 ...Previous 51.7 ...Actual 52.1
23:50 GMT or 5:20 IST JP Tankan Large Manufacturers Index
...Expected 13 ...Previous 15 ...Actual 12
1:00 GMT or 6:30 IST CN PMI
...Expected 49.7 ...Previous 49.7 ...Actual 49.8
1:35 GMT or 7:05 IST JP PMI
...Expected 50.9 ...Previous 50.9 ...Actual 51.0
7:30 GMT or 13:00 IST CH PMI
...Expected 51.9 ...Previous 52.2
8:00 GMT or 13:30 IST EU PMI
...Expected 52.0 ...Previous 52.3
8:30 GMT or 14:00 IST UK PMI
...Expected 51.3 ...Previous 51.5
14:00 GMT or 19:30 IST US Manufacturing ISM
...Expected 50.8 ...Previous 51.1
14:00 GMT or 19:30 IST CA PMI
UK Cons Conf
...Expected 5 ...Previous 7 ...Actual 3
...Expected 10.9 % ...Previous 11.0 % ...Actual 11.0 %
US ADP Emp
...Expected 192 K ...Previous 187 K ...Actual 199 K
...Expected 0.2 % ...Previous 0.4 % ...Actual 0.3 %