Dollar Index could continue to trade within 102-103 while Euro is headed towards 1.09 and should bounce back to head higher towards 1.10 as we have been expecting over the last few days. EURJPY and USDJPY have bounced back well yesterday and if the rise continues, we may soon see 159-160 and 145-146 soon in the next few sessions. This has been contrary to our earlier expected fall. USDCNY has been rising slowly and could test 7.20/22 on a break above 7.18. Aussie could be trading within 0.6650-0.6750 for the next few sessions while Pound has fallen and needs to remain above 1.26 to move back to higher level within the 1.26-1.28 range. USDRUB has broken below 90 and could now test 89-88.50 before again bouncing back to higher levels. USDINR can rise towards 83.20/30 again while above 83-82.90. EURINR can be ranged for a while.

Dollar Index (102.536) traded between 102.70-102 and could continue trade within the broad 102-103 region for the next few sessions before a break on either side is seen. They keeps EURUSD (1.0933) also within a narrow range below 1.0970 and above 1.09. Broader range of 1.0870-1.10 may continue to hold for the near term.

EURJPY (158.36) tested 157.20 yesterday but has bounced back well to rise a above 158 currently. It could head towards 159, which if breaks could take it to 160 before pausing or reversing from there.

Dollar-Yen (144.83) has bounced back well from 143.42 seen yesterday. While above 143, a decent rise to 145-146 looks possible in the next few sessions.

USDCNY (7.1716) has been inching up slowly over the past 3-sessions from 7.14 to 7.18. A break above 7.18 is needed to test 7.20/22 before again declining towards 7.15/14 in the coming week.

Aussie (0.6700) has bounced from 0.6670 itself. We may expect an immediate trade within 0.6650-0.6750 for the rest of the week.

Pound (1.2704) has fallen contrary to our expectations of seeing a rise to 1.28/2830. Now it is crucial to see if it manages to hold above 1.27 and rise back else could be vulnerable to a fall to 1.26. watch price action at 1.27 over today and tomorrow.

USDRUB (89.5644) has declined sharply and could be headed down further towards 89-88.50 before a pause is seen there.

USDINR (83.12) sustained well above the support at 83.00. While above 83.00-82.90, there is scope for a rise towards 83.20-83.30.

EURINR (90.8754) can be ranged within 90.50-91.50 for a while.

The US Treasury yields sustain higher but stable. There is room to rise further from here before the broader downtrend resumes. The US CPI data release tomorrow is important to watch. The German yields are moving up in line with our expectation. More rise is on the cards before a reversal is seen. The 10Yr GoI is coming down as expected and keeps intact our bearish view. The 5Yr GoI is coming close to the lower end of its range. Bias is bearish to see a downside breakout of this range eventually.

The US 10Yr (4.01%) and the 30Yr (4.18%) yields remain stable. A rise to 4.1%-4.2% (10Yr) and 4.3%-4.4% (30Yr) can be seen from here before the overall downtrend resumes.

The German 10Yr (2.18%%) and the 30Yr (2.41%) yields are moving up. Our view of seeing a rise to 2.35% (10Yr) and 2.5%-2.6% (30Yr) remains intact. Thereafter a fresh fall is possible.

The 10Yr GoI (7.1884%) has come down further and keeps intact our bearish view of seeing a fall to 7.1%.

The 5Yr GOI (7.0793%) can test the lower end of its 7.05%-7.13% range. The bias is negative to see a break below 7.05% and fall to 7%-6.95% if not immediately but eventually.

Dow Jones and Nifty are stuck in a narrow range. DAX has dipped and failure to sustain above 16600 will be vulnerable to fall further. Nikkei has broken above its upper end of the range and can head towards its immediate resistance. Shanghai has scope to rise as long as it holds above 2865.

Dow (37525.16, -0.42%) has closed on a mixed note. 37250-37800 is the trading range now. While below 37800, a test of 37000 is likely before a fresh rise is seen.

DAX (16688.36, -0.17%) has to sustain above 16600 to move up towards 17000 and higher. Else it will remain vulnerable to break 16500 and fall to 16000 in the coming days.

Nifty (21544.85, +0.15%) is consolidating between 21400 and 21850. While above 21400, one more leg of rise to 22000-22200 is possible before a reversal is seen.

Nikkei (34379.50, +1.82%) has broken the 32500-34000 range on the upside. While above 34000, view is bullish for a test of immediate resistance at 34500. A break above it, if seen, can be further bullish towards 35000.

Shanghai (2889.62, -0.13%) has managed to hold above the support at 2865. While above 2865, a rise towards 2930-2950 is possible.

Crude prices are likely to remain ranged for the near term. Gold and Silver look vulnerable while below the resistance at 2060 and 23.50 respectively. Copper can rise towards its immediate resistance while above 3.75. Natural Gas can come down towards 3.0.

Brent ($ 77.92) has risen towards $ 78. A sideways range of $ 75-80/81 may persist for the near term.

WTI ($ 72.60) has bounced back above $ 72. Outlook remains mixed. It is expected to remain range bound within $ 68-76 for the near term.

Gold (2037.90) is holding well below the resistance at 2060. View remains bearish for a break below 2020 and fall towards 2000-1980.

Silver (23.20) has declined as the resistance mentioned at 23.50 has held well. It can come down towards 22.80, the lower end of the 23.80-22.80 range or even break below 22.80 and fall towards 22.50.

Copper (3.7805) tested a low of 3.7570 in line with expectations for a fall towards 3.75 and has bounced back a bit from there. While above 3.75, there is scope for a rise towards 3.80-3.83.

Natural Gas (3.1880) rose sharply to test 3.3920 on Tuesday beyond our expected level of 3.1-3.2 and has fallen back to levels below 3.2. It may come down further to 3.0.

No major data release today.

DATA YESTERDAY
—————
10:00 15:30 EU Unemp
Expn 6.5% …Expected 6.5% …Previous 6.5% …Actual 6.4%

13:30 19:00 US Trade Balance
Expn -59.6$ Bln …Expected -64.9$ Bln …Previous -64.3$ Bln …Actual