GOOD MORNING!
FOREX
The Dollar Index is expected to hold above 99.50 and move towards 101 in the near term. Euro & EURINR appears bearish toward 1.14 & 101.50-101.00 while they trade below 1.16 & 102.70 respectively. EURJPY and USDJPY can head towards 178-180 & 154-155 in the coming sessions. USDCNY continues to trade within 7.15-7.10 region. The Aussie is holding the 0.645-0.660 range quite well for now. If the Pound holds above 1.3150, it can initially test 1.3250. Otherwise, a failure to sustain could drag it lower toward 1.28 from current levels. While the resistance at 88.85 holds in USDINR, a pullback toward 88.50-88.25 can be seen.
Dollar Index (99.64) has immediate support coming around 99.50 above which a rebound towards 101 can happen in the near term.
EURUSD (1.1556) and EURINR (102.4641) tested 1.1590 & 102.77 before coming down. While the resistance at 1.16 & 102.70 holds, both the pair can fall toward 1.140-1.135 & 101.50-101.00 respectively.
EURJPY (177.77) & Dollar-Yen (153.83) are gradually rising as anticipated and the targets of 178-180 & 154-155 can get achieved as long as both the pair trade above 176 & 153 respectively.
USDCNY (7.1191) is trading lower within its 7.15-7.10 range which is likely to persist for some time before a breakout occurs.
Aussie (0.6514) has bounced well from the low of 0.6467 seen on Friday. The 0.645-0.660 range remains intact for now. A decisive break on either side of its range will be needed for further directional clarity.
Pound (1.3151) needs to hold above 1.3150 to test the upper resistance coming around 1.3250 region initially. Else, a sustained move below 1.3150 can pull the pair lower to 1.28 in the medium term.
USDINR (88.6310) held the narrow range of 88.50-88.85 in the last few sessions. While the resistance at 88.85 holds, we retain our view of seeing a toward 88.50-88.25 in the near term. Only a breach above 88.85 if seen can take the pair to test the upper resistance at 89.
INTEREST RATES
The US Treasury yields remain volatile and range bound. The range can remain intact for some more time. Bias is positive to make a bullish breakout and rise eventually. The German yields are inching up. But resistance can cap the upside and drag them lower in the coming days. The 10Yr GoI is holding above its near-term support. That keeps alive the chances of seeing some rise in this week and avoid more fall.
The US 10Yr (4.12%) and 30Yr (4.72%) Treasury yields have inched up slightly. 4.05%-4.15% (10Yr) and 4.6%-4.75% (30Yr) is the trading range for now. Bias is positive to break the range on the upside and rise to 4.2% (10Yr) and 4.8% (30Yr) eventually.
The German 10Yr (2.66%) and 30Yr (3.26%) yields have moved up slightly. The resistance at 2.7% (10Yr) and 3.3% (30Yr) can be tested. Thereafter the yields can reverse lower towards 2.5% (10Yr) and 3.1% (30Yr).
The 10Yr GoI (6.5142%) has risen back from below 6.5% for the second consecutive day. While above 6.48%, a rise to 6.55% and higher is possible. A break below 6.48% will bring the yield under pressure to see 6.45% and lower levels.
STOCKS
The Dow is holding above 46500 and can work its way towards 48000. DAX has support near 23500-23000 and can rebound towards 25000. Nifty must stay above 25200 to avoid more weakness and can climb towards 25800. Nikkei stays bullish above 49000 with room to head towards 52000. Shanghai can still test 4050 while it trades above 3950.
The Dow (46987.10, +0.16%) is likely to remain above support near 46500 and eventually rise towards 48000 in the coming months.
DAX (23569.96, -0.69%) has fallen over the last week. It has support near 23500-23000 region from where a bounce back towards 25000 can be expected eventually.
Nifty (25492.30, -0.068%) needs to hold above 25200 and move up to prevent further decline in the near term and gradually rise towards 25800 and higher.
Nikkei (50637.81, +0.72%) has moved up a bit today. While above 49000, the index has fair scope to rise towards 52000 and higher eventually.
Shanghai (3997.56, -0.25%) has dipped slightly but has scope to test 4050 on the upside while above 3950.
COMMODITIES
Crude prices are holding below key resistances, keeping the scope open for a drop towards $62 on Brent and $58 on WTI. Gold is steady above $4000 and can move towards $4100-4200, while Silver’s rise above $48 supports a push to $50-52. Copper is firm and can test $5.10-5.20 within its broader $5.20-4.90 range. Natural gas remains strong with room to reach $4.50-4.60 in the coming weeks.
Brent ($63.98) has bounced back against expectations, but as long as it stays below $66, we keep our view of a decline towards $62 in the near term.
WTI ($60.14) has also bounced, yet while it remains below $62, we continue to expect a fall towards $58 in the coming sessions.
Gold ($4053.60) is holding above $4000, and while it trades above this level, a rise towards $4100-4200 looks likely in the near term.
Silver ($49.05) has broken above $48 and can now head higher towards $50-52 in the near term.
Copper ($5.0230) is rising in line with expectations and can extend towards $5.10-5.20 soon, keeping a broader $5.20-4.90 range for the coming weeks.
Natural Gas ($4.4460) is moving higher as expected and can test $4.50-4.60 in the coming weeks.
DATA TODAY
GMT 7:00 12:30 UK Unemp
...Kshitij 4.8 ...Expectation 4.9 ...Previous 4.8
DATA YESTERDAY
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NO MAJOR DATA RELEASED YESTERDAY.
DISCLAIMER
These views/ forecasts/ suggestions, though proferred with the best of intentions, are based on our reading of the market at the time of writing. They are subject to change without notice.Though the information sources are believed to be reliable, the information is not guaranteed for accuracy. Those acting in the market on the basis of these are themselves responsible for any profits or losses that might occur, without recourse to us. World financial markets, and especially the Foreign Exchange markets, are inherently risky and it is assumed that those who trade these markets are fully aware of the risk of real loss involved.
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