Some recovery is seen in the currency pairs from the movements seen last week. Dollar Index has moved up well above 102 and could test 103-103.50 before coming off while Euro can test 1.0850-1.08. EURJPY looks sable within 158-154 while USDJPY can continue to trade above 141. Aussie and Pound have dipped slightly but Aussie keeps some hope alive to see an upmove from here soon. USDCNY could rise towards 7.15/16 while above 7.10. USDRUB could test 91. Rupee saw some strength on Friday but could move back towards 83.10/15 while above support region of 82.93-83.00 holds on USDINR. EURINR has scope to fall to 90-89.

Dollar Index (102.547) has bounced back from 101.77 last week as support at 101.50 seems to be holding well for now. A test of 103-103.50 can be possible if the rise extends in the near term else we may expect a dip rom current levels, keeping a near term range of 101.50-102.50.

EURUSD (1.0904) failed to sustain its rise past 1.10 and has decline. While the resistance at 1.10 holds, a further fall to 1.0850 or 1.08 could be seen over the next few sessions.

EURJPY (155.13) has held the support at 154 quite well last week, negating our lower target of 152. While above 154, some consolidation is possible within 158-154.

Dollar-Yen (142.26) looks stable above 141 and could attempt a short rise to 143-144 in the near term. But overall view remains bearish towards 140/138 while it trades below 146 in the medium term.

USDCNY (7.1272) tested 7.1038 on Friday before moving higher from there. While above 7.10, there is scope for a rise to 7.15/16 in the near term.

Aussie (0.6706) came off from 0.6730 itself instead of rising towards our expected level of 0.68. However, view is bullish above 0.6650 and there could be some scope for a rise to 0.68 soon.

Pound (1.2687) fell sharply from level just below 1.28 towards 1.26 as expected. Immediate range of 1.26-1.28 might hold in the near term.

USDRUB (90.4250) has bounced well from 88.5480 on Friday. The pair could test 91 on the upside in the next few sessions. The immediate range of 89-91 may hold.

The RBI finally allowed the USDINR (82.93) to fall on Friday to 82.93 in line with the all time high in Indian equity indices, strong Euro and Chinese Yuan as Dollar weakness continued. 82.90-83.00 is an immediate support zone which if holds can take the pair back towards 83.10/15 or higher by end of the month. We would wait and watch movement near current levels to get more directional clarity from here.

EURINR (90.5288) rose to the level of 91.7380 last week before falling sharply and remains bearish to fall towards 90 or 89 in the near term.

The US Treasury yields have dipped further. Outlook is bearish to see more fall from here. The German yields have come down to their key supports much faster than expected. Need to see if they can bounce-back from here or not. The 10Yr and 5Yr GoI have declined further. Outlook is bearish to see more fall.

The US 10Yr (3.93%) and the 30Yr (4.03%) yields have dipped further. We repeat that the outlook is bearish to see a fall to 3.6% (10Yr) and 3.8% (30Yr) while below 4.2% and 4.4% respectively.

The German 10Yr (2.01%) and the 30Yr (2.21%) yields have come down to 2% and 2.2% respectively much faster than expected. Need to see if the yields are bouncing back from here or not.

The 10Yr GoI (7.1621%) and 5Yr GOI (7.0738%) have declined further sharply. Outlook is bearish to see 7.1% (10Yr) and 7%-6.95% (5Yr).

Dow Jones remain bullish to target news highs. DAX is consolidating in a narrow range but broader outlook is bullish to see a break on the upside. Nifty has scope to test its resistance. Need to see if it falls back from there or continues to rise further. Shanghai has scope to rise while above the support at 2925. Nikkei is bearish while it remains below the resistance at 33100-33500.

Dow (37305.16, +0.15%) is heading up towards 37500 as expected. As mentioned earlier the big picture is bullish to see 39000-39200 while above 36000.

DAX (16751.44) is consolidating between 16600 and 17000. Bias is positive while above 16600 to break 17000 and rise to 17400.

Nifty (21456.65, +1.29%) tested 21500 as expected. A test of 21700 is possible. The price action thereafter will need a close watch to see if a reversal is happening or not.

Nikkei (32575.17, -1.20%) remains stuck within 32500-33100. It has to rise past 33100-33500 to move up towards 33900-34000. Else chances are high to see a fall towards 31500.

Shanghai (2941.32, -0.04%) tested the support at 2925 and is bouncing back from there. While above 2925, a rise towards 2990-3000 looks possible.

Crude prices remain bullish for a rise towards their resistance in the near term. Gold and Silver have fallen back and can fall further if they stays below 2060 and 24.50 respectively. Copper needs to surpass 3.90-3.92 to strengthen the bullish momentum; else can be range bound for some time. Natural Gas continues to rise and has scope to test its key resistance.

Brent ($ 76.86) is inching up towards $ 78. View remains bullish for a rise towards $ 80-81.

WTI ($ 72.08) is hovering around $ 72. Bias is bullish for a rise towards $ 75-76-77.

Gold (2034.80) has fallen back after facing rejections from 2060 contrary to our view to see a rise towards 2075-2080. It has scope to fall towards 2000-1980.

Silver (24.16) has fallen back towards 24 failing to rise above 24.50. As mentioned earlier, a sustained break above 24.50 is needed to see a rally towards 25-25.30. Else it can fall towards 23.50.

Copper (3.8780) lacks strength to rise above 3.90. A sustained break above 3.90-3.92 is needed to see a rally towards 4.00. Else it could trade within 3.92-3.80 for some time.

Natural Gas (2.5140) continues to rise. Bias remains positive for a test of 2.60. It has to surpass 2.60 to reduce the downside pressure and to move up towards 2.80. Else it would be vulnerable to see a fall towards 2.20.

9:00 14:30 GER IFO Business Climate
Expn 88.5 …Expected 87.8 …Previous 87.3

9:00 14:30 GER IFO Business Situations
Expn 90.1 …Expected 89.5 …Previous 89.4

9:00 14:30 GER IFO Business Expectations
Expn 88.5 …Expected 85.8 …Previous 85.2

DATA FRIDAY
—————
23:05 4:35 UK Cons Conf
Expn -44 …Expected -23 …Previous -24 …Actual -22

9:00 14:30 IN Trade bal
Expn – …Expected – …Previous -31.46 …Actual -20.58

10:00 15:30 EU Trade Bal
Expn – …Expected 10.3 …Previous 9.2 …Actual 10.9

14:15 19:45 US Industrial Production
Expn -0.1% …Expected 0.3% …Previous -0.9% …Actual 0.3%

14:15 19:45 US Capacity Utilization
Expn 78.8% …Expected 79.1% …Previous 78.9% …Actual 78.8%