EUR/USD rebounds from the lower level 1.2143 hits the weekly high at 1.2671.

Euro recovers from the four year low at 1.2145 on Wednesday extended higher today Eur/Usd at 1.2671.From past four sessions, all the commodities and equities continued their sell off dragging the Euro Lower. From last night on Wednesday the Euro rose biggest weekly advance more than 9 months against the dollar, on the optimism European Union officials meeting today .In this meeting they are going to take the decision on the region’s debt crisis.

Japanese Finance Minister Naoto Kan said that it’s undesirable for currencies to stay from “stable “levels. The Euro touched a four –year low on May 19, has gained around 2 percent after the announcement from European Union of 750 billion bailout packages for Euro zones. German officials announced ban on short selling so it was negatively affected on Euro zone.

While today is the major data coming from German .The data called German Ifo Business Climate. The data is forecasted 101.9, previously it was 101.6 its leading indicator of economic health – business reacts quickly to market conditions, and changes in their sentiment can be early signal of future economic activity such as spending, hiring, and investment. If the data is coming as the prediction the euro goes in a green otherwise it will go down

As per the technical point of view Eur/Usd having resistance level at 1.2672 and the second resistance 1.2853. On the other side the Eur/Usd having major support at 1.2334 and the second support level at 1.2137. If the Eur/Usd breaks this second support level then there is no hope upto 1.2064level.

Have A Very Happy Trading !!

Nifty Comparison Between 2008-2010, Nifty May Target 4870-4855

The above sheet is showing the comparison between the Nifty movement from 2008-2010. Now nifty is close last week as the same as closed at 09 May,2008. So Nifty follows the trends. Also history repeats again.

Weekly Nifty Trend :    

• Bearish black candle breaking and closing below the trend line from March 2009 lows.
• Volumes were good and breadth very negative.
• Oscillators are weak below the 50 level and macd is once again in sell mode.
• Trend line support at 4814 

Daily Nifty Trend : -

• Fall continuously on all days of the last week on increasing volumes and extremely bad breadth.
• 61.8 % fibo support at 4955 of rise from 4675 . 
• Oscillators weak and stochastics in oversold zone in positive divergence.
• Taken support on trend line from 3918. Must trade above 4990 for a bounce from the trend line.
• 200 dema at 4880 coinciding with the 50% fibo level of rise from 3918  and the 200dsma is at 4962 almost coinciding with 61.8% fibo level of rise from 4675.

The nifty has fallen sharply for the last 5 trading days without respite.The daily and weekly oscillators are weak and indicating further fall. The intraday charts though are showing positive divergence and very minor bullish patterns which could develop into a small bounce.Strong supports at 4960-4955-4880 supports this possibility.

Trade above 5046 is necessary for further bullishness.Resistance is at 5150.

The trend is down and one should look for opportunities to short on rallies.

Happy Trading !!

Dipak Sharma

sdipak83@sify.com
9372486367

Four points to always remember in the back of your mind.(Global Market Update)

1) EURO Zone will spilt or there will be serious disagreements among the members during the next five years.

2)Dollar will make historic highs against Pound and Euro in the next three years.

3)Stock, metals and energy markets currently looks very uncertain until 27 May, notably alternative energy stocks, will enter in its most unique era in the Wall Street history.

4)Rand(ZARUSD) will enter into a hugely negative period from mid June and I see Rand going back to 13.00 against USD by end of 2012.

One surprising point is here – compared to USA market fall, all other markets will fall even more although the Goldman charge originated from USA. Japan, Hong Kong, India, China and all major European market will crack big.

More Downside Pressure Expected on Euro versus US dollar.

After a strong up a couple of weeks ago the EURUSD pair has meandered over the last week. Greek hopes and worries dominated the Euros trading in the last week. The Euro had the best weekend gap, starting above 1.36 and almost reaching 1.37 last week. After it dropped and closed the gap on Friday. The Greek troubles aren’t over yet.


After starting the week with an impressing weekend gap (after releasing the news of Goldman Sachs scandal) Greek Finance Minister Giorgos Papakonstantinu said Greece’s talks with the European and IMF officials on a potential aid package will last two weeks and a joint text will then agreed by May15. He also said “rumours about restructuring pf debt are nonsense”. Axel Weber, the President of the Bundesbank is not only an influential member of the ECB,but the leading candidate to replace Jean-Claude at the top position. He said to the group of German lawmakers that Greece may require financial assistance of as much as 107.92 billion dollar to escape its debt crisis and avoid default.

The European Union said Greece’s budget deficit last year was worse than it previously forecast and could top 14 percent of gross domestic product as “off-market swaps” cloud its estimates. The EU’s statistics office said today Greece’s deficit was 13.6 percent last year, higher than the governments April 7 forecast of 12.9 percent. Greek bond yields have surged to the highest in more than a decade. Also in near term the Euro has the selling pressure because the widening of the Greek 10-year bond or German Bond spread to 500 basis points.

On Tuesday the German PPI data was released at 0.7 percent while the forecasted value was 0.5 percent. German Producer Prices took a break and remained unchanged last month. After two months of surplus, Europe’s current account, consisting of good trade balance ,services and money, fell into a deficit of revised 1.7 billion last month. This deficit was actually 3.9 billion and 5.3 billion was the market consensus. From the past six months, the German ZEW economic sentiment has been on the fall, hurting the Euro all the time. Previously it was 44.5 points; the released data was 53 points which had a small impact on the Euro.

French Flash Manufacturing PMI is released with value of 56.7 points. The services sector is somewhat lagging behind, in Europe’s second largest economy. According to German Flash PMI, the Europe’s largest economy enjoys a strong manufacturing sector. The services sector was released to advance from 60.2(revised) to 61.3 points. All European Flash PMI rose from 54.1(Revise) to 55.5 Points. All the numbers are above the critical line of 50 shows positive economic expansion.

Today, the President Mr. Jean-Claude Trichet of the ECB might comment about the situation of debt-struck countries and might also say something about the stagnant economy.Tomarrow there are three main economic indicators called German Ifo Business Climate ,this is the second major survey from Germany. The data is expected to rise from 98.1points to 98.9 points. The data is the highest in almost two years. There is another data, which is going to be published on Friday called Industrial New Orders, the data is expected to fall from 1.6 percent to 0.9 percent.

As a technical point of view, the EURUSD has a support at around 1.3109 - this was the low of last year in May (that is May18, 2009)and the second support at 1.2959 .On the other hand, the EURUSD has a resistance level at 1.3423 which was the high of March 26, 2010.The second resistance for EURUSD is at 1.3493.
Have A Great And Profitable Trading Day.........