The dollar Index has risen above 102.50 post rise in the US manufacturing index released for Dec-23 and can test 103-104 before pausing. Meanwhile Euro is headed towards 1.09 from where the reversals towards 1.10 is expected. Failure to hold above 1.09 could turn bearish for the medium term. EURJPY and USDJPY have risen sharply contrary to our expectations and could be bullish for the next few sessions. USDCNY tested 7.15/16 on the upside as expected and needs to rise past 7.16 to head towards 7.20/22. Aussie has held above 0.67 but need to see if the bounce would sustain for the medium term else could turn bearish towards 0.66. Pound has sustained well above 1.26 but a break on either side of the 1.26-1.28 range is needed to get further clarity in view. USDRUB has risen past our expected resistance of 92 and could now be possibly headed towards next resistance at 92.60 before pausing. The range of 83.35-83.20 could hold in USDINR for now. EURINR tested 91.35 on the upside before falling and is now expected to test 90.50/90.00 on the downside.

Dollar Index (102.50) has risen as expected and needs to sustain the rise above 102.50, to move up towards 103-104 in the medium term. Else an immediate fall from current levels is necessary for the index to resume falling back towards 100 or lower. Watch price action near current levels.

EURUSD (1.0918) tested an intraday low of 1.0893 yesterday before rising slightly. If the Euro fails to hold above 1.09, further decline to 1.08-1.07 cannot be negated. Watch price action near 1.09.

EURJPY (156.65) has risen past 156, contrary to our expectations of seeing a fall towards 154. A further test of 157-158 could be possible while it sustains above 156 in the medium term.

Dollar-Yen (143.45) rose sharply above the upper end of our mentioned range of 140-143 but a decisive break past 144 would be needed to make the outlook bullish towards 146 or higher.

USDCNY (7.1579) has risen to our mentioned target of 7.15/16. Going ahead, a sustained break past 7.16 will be needed to continue the rise towards 7.20/22.

Aussie (0.6725) seems to have taken support at 0.67, above which a short rise to but if the US Dollar continues to strengthen, Aussie may continue to fall below 0.67 targeting 0.6650-0.66 soon.

Pound (1.2658) bounced from levels just above 1.26. But we may expect trade within 1.26-1.27 for a few sessions followed by a fall towards 1.25/24 in the medium term.

USDRUB (92.0370) has been rising sharply over the last 4-sessions. Immediate resistance could be seen near 92.60 which needs to break on the upside for it to move further towards 93-94. Else, decline from 92.60 could drag it back towards 90-89.

USDINR (83.28) could dip while below 83.35 and fall towards 83.20/15 keeping a range of 83.35-83.15 alive for some more time.

EURINR (90.9605) looks bearish for a fall towards 90.50-90.00.

The US Treasury yields rose to test their resistances as expected and has come down thereafter. The price action in the coming days will need a close watch to see if the yields move up again to break the resistances or resuming their downtrend from here itself. The German yields have dipped slightly. They have room to rise further from here to test their resistances before a fresh fall happens. The 10Yr GoI is moving up in line with our expectation to test its resistance. A fresh fall can be seen thereafter. The 5Yr GoI continues to remain mixed, and range bound within its overall downtrend.

The US 10Yr (3.92%) and the 30Yr (4.07%) yields touched 4% and 4.15% respectively as expected and has come down again. A decisive rise past 4% (10Yr) and 4.2% (30Yr) is needed to see an extended corrective rise. Else the downtrend can resume from here itself. The price action in the next few days is important.

The German 10Yr (2.02%%) and the 30Yr (2.27%) yields have dipped slightly. The yields can rise to test 2.2%(10Yr) and 2.4% (30Yr) and then a fresh fall is possible.

The 10Yr GoI (7.2156%) is heading up towards the 7.24%-7.25% resistance as expected. It can fall back from there to resume the downtrend and target 7.1% on the downside.

The 5Yr GOI (7.1075%) remains mixed and continues to oscillate between 7.04% and 7.13%. The broader view is bearish to see a fall to 7%-6.95% eventually.

Most of the equities fell after FOMC minutes showed no signs of rate cut happening soon. Dow Jones and Nifty have declined and can extend the fall further. DAX has fallen sharply but managed to close above its 16500 support. A decisive break below 16500 will turn the outlook bearish for DAX. Shanghai continues to fall and might be vulnerable to fall further if its breaks below 2925.

Dow (37430.19, -0.76%) has declined below 37500 and can now test 37000 on the downside first. This will delay the expected rise to 38000.

DAX (16538.39, -1.38%) is poised above its crucial 16500 support. A decisive break below 16500 will turn the outlook bearish to see 16000 and lower levels. That will negate our bullish view of seeing 17200-17400 on the upside.

Nifty (21517.35, -0.69%) can see an extended fall to 21200 and even 21000 on a break below 21500. A fresh rise thereafter will still keep the doors open to test 22000-22200.

Nikkei (33107.50, -1.09%) fell sharply to 32685 before bouncing back from there. Immediate resistance is now at 33400-33500 region. While that holds, it would be vulnerable to come down towards 32500-32000.

Shanghai (2943.78, -0.76%) is drifting lower. If it manage to sustain above the support at 2925, our bullish view will remain intact for a rise towards 3000. Else can fall towards 2900-2875.

Crude prices have bounced back sharply due to the disruptions in global supply as Libya was forced to shutdown its Sharara oil field which can produce about 300,000 barrels per day following local protests. Gold and Silver have declined after the FOMC minutes of the meeting showed that there is no indication that a rate cut would occur soon. Copper has bounced back a bit but will remain vulnerable while below the resistance at 3.88-3.90. Natural Gas has risen well and has room to move up further in the near term.

Brent ($ 78.49) has bounced back sharply above $ 78 from a low of $ 74.79. The outlook is mixed. A broad sideways range of $ 81-72 may continue to hold for the near term.

WTI ($ 73.07) has risen back above $ 73 from a low of $ 69.28. We can expect a broad range of $ 68-76 to hold for some time.

Gold (2047.50) is heading down towards 2040 as expected. While that holds, a bounce back towards 2080 is possible. In case it breaks below 2040 a dip towards 2000 can be seen.

Silver (23.14) has broken below the mentioned support region of 23.50-23.30. While this break sustains, a further dip towards 22.80-22.50 can be seen.

Copper (3.8665) has bounced back slightly after testing a low of 3.8310. However, resistance comes up at 3.88-3.90. While it remains below 3.88-3.90, a fall to 3.80-3.78 or 3.75 cannot be negated.

Natural Gas (2.7020) has risen to 2.70 as expected. A further rise towards 2.8 looks possible. Thereafter a break above 2.80 is needed to move up towards 3.00.

0:30 06:00 JP PMI
Expn – …Expected 47.7 …Previous 48.3

13:15 18:45 US ADP Emp
Expn – …Expected – …Previous 103.0K

DATA YESTERDAY
—————
5:00 10:30 IN Manufacturing PMI
Expn 57.5 …Expected 55.9 …Previous 56.0 …Actual 54.9

8:30 14:00 CH PMI
Expn – …Expected 43.0 …Previous 42.1 …Actual 43.0

14:00 19:30 US Manufacturing ISM
Expn 46.2 …Expected 47.2 …Previous 46.7 …Actual 47.4