The US Dollar gained as Euro once again failed to get close to 1.34 levels despite stable market condition in Europe and some positive news to increase firewall funds. USD did not react to low durable goods number, as February’s 2.2 pct growth was against market expectation and pushing Euro below the important support level of 1.3280.
Sterling became 1st casualty as it was looking for reason to dip after failing to break 1.60 physiological levels and soon after the announcement by the UK office of National Statistics of revision of UK’s 4th quarter GDP to contract to 0.3 pct against its earlier estimate of 0.2 pct.
Later Gold also got clobbered with the developing news as oil took the lead after reports that Sarkozy is trying to convince UK & USA to release oil from its reserves to ease price pressure. Softer oil eases inflationary pressure one of cause that helps gold.
Gold is also under pressure due to prolonged strike since last 12-days in India as bullion and jewelry traders are demanding to withdraw hike in gold import duty. Indian gold and silver buying per month averaged USD 5.45 billion. Slowdown of Chinese economy is also discouraging gold prices, as China and India are the top two gold buying nations.
I think market will trade in narrow range during rest of Asian and European session unless couple of data’s from UK and Germany brings some spark in the market. However, US 4th quarter GDP data and weekly jobless claims can bring traders on their toes.
Euro @= 1.3326 = Expecting a slow day with top around 1.3350, if seen prefer Euro with STOPS 1.3385 and will buy Euro around 1.3275 with STOPS 1.3240 for 40-50 pips
GBP @ = 1.5905 = Prefer buying Cable around 1.5870's with Stops 1.5840 for 40-50 pips. Will keep you posted if I see a selling level.
GOLD @ = $ 1661.70= I still see downside risk as long as Gold stays below $ 1668. Therefore, should top out around $ 1664-65 for $ 1655, with possibility for a test of $ 1648.
March 28 - PrefeR SellinG EurO, GbP & GoLD