GOOD MORNING! STOCKS
The markets will go into slumber as the traders and investors head out for holidays. We are likely to see ranged markets with no big moves. The respected levels - supports and resistances will be maintained until the volumes come back into the market.
Dow (17,804.80, +0.15%) is likely to low volume interest this week. 17,900-18,000 at the top and 17,700 at the bottom should contain the trades till the end of holidays.
Nikkei (17,621.66, +0.00%) is trading flat on low volumes. In medium term, we are likely to see Nikkei trade in a broad range of 18,000 and 16,500.
Shanghai (3168.01, +1.88%) has restarted its bull run with the break above previous tops at 3091. The targets above 3091 are 3200 and 3264.
The underlying bias in Dax (9,786.96, -0.25%) is bullish in expectations of ECB's QE in January. The first resistance is at 9,950-10,000 levels. We expect the range of 10,000-9,700 to maintain right through the holidays.
Nifty (8,029.80, -0.47%) may see slightly more action than global indices as we head into expiry week. Selling pressure from FIIs is likely to diminish. With the current trend of DIIs allocating their cash reserves ahead of year-end, we expect the bias to be bullish.
Gold (1197.27) is trading above immdiate channel support near 1190 and while that holds we may see a short term rise to 1220-1230 before any further move is decided.
Silver (15.99) has also paused a bit after the sharp fall from 17 levels. We may expect a ranged move in the 16.35-15.5 region for now.
Brent (62.06) is trading a bit higher and may start rising soon towards 65 while Nymex WTI (57.70) has found support at 53.62 and is ranged in the 53.69-58.92 region for now. Overall trend remains down.
Copper (2.8725) has risen and is currently tradig higher but the 2.85-2.95 levels still hold. We may see some ranged moves in the said region for a few more sessions before we see a break on either side.
We expect the larger levels and trends to hold right through the holidays into New Year, until we see the volumes come back.
Euro (1.2245) ends the year 2014 near its lowest point. The Yearly, Quarterly, Monthly and even Weekly candles will all become bearish on the close. Euro has managed to gain some support at 200-month moving average at 1.2225. As the QE play comes into effect in January, expect the Euro to break below this line of support also.
Pound-Dollar's (1.5642) is confined to its range of from early-November. We expect this range of 1.5750-1.5600 to continue through the holidays.
Dollar-Yen (119.40) is likely to see the tops and resistances of 120.00 and 119.50 to hold right through the holiday season. The supports at 118.50 are also likely to hold strong.
Dollar-RUPEE (63.29) is expected to trade within a broad range of 62.80-63.90, and a narrow range of 63.00-63.50. The volatility we saw last week is likely to be diminished.
Aussie-Dollar (0.8139) is likely to hold the downward trending resistance now at 0.8200 through the holidays.
Treasury bonds are falling globally and are in long term down trend.This may continue for some weeks now.
The German 5Yr(0.054%), 10Yr(0.593%) and 30Yr(1.413%) are all falling. The German-US 10Yr yiels differential (-1.559%) is trading at lowest levels in the last few years and shows no signal of any reversal for now. Oerall the yields may continue falling in the neqr term.
The UK 5Yr(1.254%) and 10Yr(1.849%) Gilts have fallen from 1.288% and 1.877% respectively while the 30Yr(2.610%) has risen from 2.607%.
The Indian 10Yr GOI yield (7.96%) is again up and may fluctuate in the 7.8-8% zone in the near term. A break above 8% may see a rise to resistance near 8.15-8.20%.
15:00 GMT or 20:30 IST US Existing Home Sales
...Expected 5250 K ...Previous 5260 K
UK Cons Conf
...Expected -1 ...Previous -2 ...Actual -4.0
...Expected <0.10 % ...Previous <0.10 % ...Actual <0.10 %
EU EA (17) Curr Acct Bal
...Previous 32.0 EUR Bln ...Expected 28.0 EUR Bln ...Actual 20.5 EUR Bln
CA Inflation Y/Y
...Previous 2.40 % ...Expected 2.20 % ...Actual 2.00 %