Most currencies are trading strong against the Dollar which itself is heading towards support at 101 from where a bounce can be expected. Such a fall in the Dollar Index may possibly take Euro up towards 1.11-1.1145 before dragging it lower. EURJPY and USDJPY have been falling sharply but could test support near 153.40-154 and 139 from where a bounce is possible. USDCNY could head towards 7.15/10 while below 7.2150. Pound and Aussie have surged and could be headed towards 1.2950-1.30 and 0.68-0.6850 respectively. USDRUB fell sharply below 94 and could now head towards 88-86 soon. Resistance on 82.80 is holding well on USDINR and with the current momentum of fall, a test of 82.20-82.00 can be possible in the next few sessions. EURINR has also surged and could face rejection from 91, else a break above 91 will be bullish towards 92. Watch price action near 91 for now.

Dollar Index (101.415) has been falling sharply in a strong downtrend and could face support near 101 initially where price action is to be seen. An initial bounce from 101 can be expected towards 102 over the next 1-week.

EURUSD (1.1029) is rallying upwards and can soon head towards resistance near 1.11. A fall from either 1.11 or from 1.1145 looks possible soon.

EURJPY (154.05) has been falling over the last 7-sessions and could possibly bounce from support near 154-153.40 in the next few days. Failure to bounce from 153.40 could e strongly bearish for a target of 152. For now watch price action near 153.40-154.

Dollar-Yen (139.63) has broken below our expected 140 but could face support near 139 soon before bouncing back towards 141 soon.

USDCNY (7.1861) has not been able to break above 7.2678 and has instead fallen sharply to current levels contrary to our expectation of seeing a rise towards 7.30. A fall to 7.10 cannot be negated in the near term.

Pound (1.2962) has been rallying but has near term resistance near 1.30 (revised from 1.2950 mentioned yesterday) from where a sharp rejection looks possible. A break above 1.30 if seen will be further bullish for the medium term.

Aussie (0.6736) has moved up sharply breaking above 0.67. There is fair chance of seeing a rally towards 0.68-0.6850.

USDRUB (90.0013) fell sharply from 94 earlier this week and is expected to come down slowly towards 88-86 soon.

USDINR (82.3625) has been holding well below the resistance near 82.75/80 and falling as expected. Yesterday’s mentioned 82.50/40 has been met and if the pair falls with current momentum, it can target 82.20-82.00 on the downside.

EURINR (90.7753) tested 90.9830 yesterday before seeing a slight dip. A break above 91 if seen will be very crucial and suggest fresh rise in the coming sessions towards 92 or higher. Else a sharp rejection from 91 will take it down towards 90-89 region again in the coming weeks.

The US Treasury yields have come down sharply. Failure to rise back from here can put the yields back into their sideways range. The US CPI data release today is important to watch. A soft inflation number could drag the yields lower. The German yields sustain higher and are keeping our bullish view intact. The yields can rise further. The 10Yr and 5Yr GoI have come down sharply. More fall is possible if they fail to rise back immediately from current levels.

The US 10Yr (3.96%) and (4%) have come down further. The 10Yr is back into its 3.8%-4% range. Failure to rise back above 4% can drag it down to 3.8%. The 30Yr can also fall to 3.85%-3.8% if it declines below 4%.

The German 10Yr (2.64%) and the 30Yr (2.65%) yields sustain higher and are keeping our bullish view intact. The 10yr can rise to 3% while above 2.5% and the 30Yr to 3.1% on a break above 2.65%.

The 10Yr GoI (7.0935%) has come down sharply and indeed below 7.1%. Failure to bounce back above 7.1% can drag it down to 7.05% and will negate the chances of the rise to 7.2%.

The 5Yr GOI (7.0797%) has come down to test the support at 7.07%. Need to see if it is bouncing back above 7.1% or will fall up to 7%.

Dow and DAX look bullish for the near term. Shanghai needs to break above its immediate resistance to strengthen the momentum on the upside to avoid the danger of falling deeper from here. Nifty is stuck in a narrow range but bias is bullish to see an eventual rally on the upside. Nikkei had declined below its support at 32000 and can now come down further from here.

Dow (34261.42, +0.93%) has risen above 34000 and can now head up towards 34500 – the upper end of the 33500-34500 range. Bias is bullish to break the range on the upside rise to 34800-35000 first and then 35500 eventually.

DAX (15790.34, +0.75%) has moved up further and is likely to test 16000. A strong rise past 16000 will negate our bearish view of seeing a fall to 15500-15000.

Nifty (19439.40, +0.43%) is stuck between 19300 and 19525. The bias is positive. A sustained rise above 19500 will take the Nifty up to 19800-20000.

Nikkei (31881.00, -1.00%) couldn’t sustain the bounce and has declined below 32000. A test of 31500 or 31000 looks possible now before a bounce back can happen.

Shanghai (3218.3912, -0.09%) is facing rejections from 3225. Only a sustained break above it could see a target of 3250. Else it would be vulnerable to a decline below 3200 and fall towards 3150 or lower.

Brent has risen sharply above the resistance of $ 79 and can now target $ 80-81. Need to see if it can break above these levels or not. WTI on the other hand, is attempting to break above the resistance at $ 75. Gold is gradually moving up towards the upper end of the range. Silver and Copper lack follow-through rise above their immediate resistances. Today’s key focus would be on the outcome of US CPI data which could provide some direction for both crude prices and Metals.

Brent ($ 79.66) has broken above the upper end of the $ 79-$ 71 range. The next crucial resistance comes at 80-81. A sustained break above these levels, if seen, could pave the way towards $ 85. Else can dip to $ 77-76.

WTI ($ 74.97) has gained momentum and is attempting to break above the upper end of the $ 75-$ 67 range. A sustained move above $ 75 could lead to a rise towards $ 77-78. On the downside, support is at $ 73-72.

Gold (1942.80) is moving up towards the upper end of the 1950-1900 range. A strong break above it, if seen, could pave the way towards 1975-1980.

Silver (23.40) rose to a high of 23.60 yesterday and has come down from there. Immediate support is at 23.20/23. While above 23, it has the potential to break above 23.50 and rise towards 24 or even higher.

Copper (3.7820) lacks follow through rise above 3.8. However, support is at 3.75, while above this, there can be chances of seeing a break above 3.8 and rise towards 3.9.

12:00 17:30 IN IIP
Expn 4.2% …Expected 1.2% …Previous 4.2%

12:00 17:30 IN CPI
Expn 4.30 …Expected – …Previous 4.25

12:30 18:00 US CPI (MoM)
Expn 0.5% …Expected 0.3% …Previous 0.1%

12:30 18:00 US Core CPI (MoM)
Expn 0.4% …Expected 0.3% …Previous 0.4%

14:00 19:30 BOC Meeting
Expn – …Expected 5.00% …Previous 4.75%

DATA YESTERDAY:
—————–
6:00 11:30 UK Unemp
Expn – …Expected 3.8% …Previous 3.8% …Actual 4.0%