A stronger US ISM manufacturing and ISM employment index and stable EU PMI together has aided a rise in the Dollar index while Euro has plunged. We may now expect 108 on the index and 1.04 on the Euro to hold and produce a reversal. Pound, Aussie and EURJPY have all fallen on Dollar strength and are expected to test 1.20, 0.63 and 156. USDJPY can move up towards 150-152 before pausing or reversing from there. USDCNY can be stable within 7.28-7.32 for a while. USDRUB broke the 98-94 range and finally moved up above 99. Could soon test 100-102.50. EURINR can fall to 87. USDINR can rise to 83.30 while above support at 83.

Dollar Index (107.125) continues to rise, aided by a stronger ISM manufacturing index. A test of 108 is possible in the next few sessions but if the index will reverse as expected or if it would break higher would be important to see the next course of movement.

EURUSD (1.0467) has fallen back, unable to sustain above 1.06 as stable PMI release weighed on the price with a strong uptick seen in the US manufacturing index. View is bearish towards 1.04 but if a reversal is not seen from there, it could be vulnerable to a sharper decline towards 1.02. Price action at 1.04 will be crucial to watch.

EURJPY (156.85) may hold within 156-159 for the near term.

Dollar-Yen (149.84) is headed towards 150-152 while above 148. The pair could face rejection from anywhere within 150-152 which is a crucial resistance zone.

USDCNY (7.3005) has support near 7.28 which if holds can allow the pair to move up towards 7.35 slowly. Else we may expect some consolidation within 7.28-7.32 for the next few sessions.

Aussie (0.6341) has fallen sharply and could again move towards 0.63.

Pound (1.2073) is headed towards 1.20 from where a possible bounce can be expected to 1.21-1.22. Watch price action near 1.20.

USDRUB (99.3760) has finally risen breaking the 98-94 range and could soon be headed towards 100-102.50 on the upside. View is bullish above 98.

USDINR (83.0450) has support at 83 which if holds can produce a rise back to 83.30 especially while the US Dollar has strengthened. But it would be important to see if the pair would break above 83.30 to move higher.

EURINR (87.1159) must bounce from 87 else can be bearish for a fall to 86.

The US Treasury yields continue to move up. They have room to rise further before reversing lower to see a corrective fall. The German yields sustain higher. Outlook remains bullish to see more rise from here. The 10Yr and 5Yr GoI continue to oscillate within their range. The bias is bullish to see an upside breakout of this range eventually.

The US 10Yr (4.68%) and the 30Yr (4.79%) have surged towards 4.7% and 4.8% as expected. The yields can test 4.75% (10Yr) and 4.85% (30Yr) and then a corrective fall to 4.5% (10Yr), 4.6% (30Yr) and even lower is possible.

The German 10Yr (2.92%) and the 30Yr (3.13%) remains higher. The 10Yr has room to test 3.1%. The 30Yr has risen just above 3.13% and while this sustains, a further rise to 3.3%-3.4% is possible.

The 10Yr GoI (7.2162%) and the 5Yr GOI (7.2279%) retains their 7.1%-7.25% range. While the range can remain intact for some more time, the bias is bullish to break 7.25% and see a rise to 7.35% (10Yr) and 7.3%-7.45% (5Yr).

Equities looks bearish. Dow Jones and Nikkei looks vulnerable to test 33000-32800 (Dow) and 31000 (Nikkei) respectively. Nifty needs to sustain above 19500 to avoid falling deeper in the coming sessions. DAX has come down again, failing to sustain the bounce and looks bearish to break below 15200.

Dow (33433.35, -0.22%) looks vulnerable to test 33000-32800 while below the 33700-33800 resistance.

DAX (15247.21, -0.91%) has come down again, failing to sustain the bounce and looks likely to break 15200. If that happens, an extended fall to 14800 is possible.

Nifty (19638.30, +0.59%) has important support at 19500-19400 which will have to hold to avoid a deeper fall to 19200-19000. Resistance at 19800 will have to be breached to ease the downside pressure. We will have to wait and watch.

Nikkei (31306, -1.53%) has declined further below 31500. View remains bearish for a fall towards 31000. Thereafter we have to see if it bounces back or comes down further towards 30000.

Shanghai (3110.48) is closed today and will remain closed till Friday.

Commodities have fallen on the hawkish stance of US Federal Reserve officials on 2nd Oct23 speech. US Federal Reserve officials says that monetary policy will need to stay restrictive for some time to achieve their inflation target. Brent and WTI continues to fall and have scope to test $ 89 and $ 86-85 before a bounce back can happen. Gold, Silver, Copper and Natural gas looks bearish for a fall towards their support before a reversal can happen.

Brent ($ 89.90) has come down breaking below our mentioned support at $ 92-91.50. It has scope to test key support at $ 89. If that holds, a bounce back can be seen towards $ 92-93. Failure to hold above $ 89 can drag it further down to $ 87.

WTI ($ 87.85) has fallen sharply, breaking below the support at $ 90-89. A fall towards $ 86-85 looks likely before a reversal can be seen from there.

Gold (1834.30) has indeed fallen but way beyond our expected level of 1850. While below 1850/1840, view is bearish to see a test of 1800 before a reversal can be seen from there.

Silver (20.94) has plunged below 21 breaking below the support at 22.50. While below 22.50/22.40, view is bearish for a fall towards 20.50-20. Thereafter a bounce back can happen.

Copper (3.6070) has declined towards 3.60 as the resistance at 3.80 has held well as expected. View is bearish to see a test of 3.58-3.55.

Natural Gas (2.83) has fallen below 2.90 as the resistance at 3.00 seems to be holding well. A fall towards 2.70-2.65 looks possible while it stays below 3.00.

22:30 04:00 AU PMI
Expn -22.2 …Expected – …Previous -19.8

3:30 09:00 RBA Meeting
Expn – …Expected 4.1% …Previous 4.1%

5:00 10:30 IN Manufacturing PMI
Expn 59.5 …Expected – …Previous 58.6

6:30 12:00 CH CPI
Expn – …Expected 1.8 …Previous 1.5

DATA YESTERDAY:
————-
23:50 05:20 JP Tankan Large Manufacturers
Expn – …Expected 6 …Previous 5

0:30 06:00 JP PMI
Expn 49.7 …Expected 48.6 …Previous 49.6

7:30 13:00 CH PMI
Expn 41.0 …Expected 40.6 …Previous 39.9

8:00 13:30 EU PMI
Expn – …Expected4 3.4 …Previous 43.5

8:30 14:00 UK PMI
Expn 43.7 …Expected 44.2 …Previous 43.0

9:00 14:30 EU Unemp
Expn 6.4% …Expected 6.4% …Previous 6.4%

13:30 19:00 CA PMI
Expn 47.3 …Expected – …Previous 48.0

14:00 19:30 US Manufacturing ISM
Expn 47.3 …Expected 47.8 …Previous 47.6