The Dollar Index could test the lower end of the 104.50-103.50 range while Euro may rise to 1.08-1.0850 from where a dip can be possible by early next week. EURJPY reversed on testing 158.92 itself and could further rise to 160.40 in the coming sessions. USDJPY needs to break past 149 to negate our bearish view towards 147.5-146. USDCNY seems to be hovering around 7.20. Aussie needs to break past 0.655/0.66 to rise further else can decline back to 0.65 or lower soon. Pound held the support of 1.25 quite well and is now back within its earlier range of 1.26-1.28. EURINR is rising towards 89.80/90 as expected from where a dip can be possible soon. USDINR on the OTC is coming down towards 82.90. It may trade within 83.10-82.80 region just now where 83.10 is an immediate and important resistance. RBI policy meeting is due today where the central bank is expected to keep rates unchanged. Some volatility can be seen in USDINR today.

Dollar Index (103.99) has dipped as expected and could continue to fall towards 103.50 or lower in the next few sessions. View is bearish below 104.50/105.

EURUSD (1.0781) has also been moving up over the past 3-sessions while above 1.07. Immediate resistance can be seen between 1.0810-1.0850 region from where a dip can be possible either at the end of this week or early next week. Overall near term trade zone of 1.07-1.0850 can hold for a few sessions.

EURJPY (159.96) resumed its rise on testing 158.92 itself contrary to our expectation of seeing a dip to 158 mentioned yesterday. While above 158.90, the pair could rise towards the upper end of the 160.40-158.90 range (narrowed down from the broad range of 161-158 mentioned yesterday).

Dollar-Yen (148.33) bounced back from 147.64, contrary to our mentioned fall towards 147/146 but a decisive break past 149 will be needed to see an extended rise to 150-151. Else while below 149, view remains intact to see a fall towards 147 eventually.

USDCNY (7.1938) is hovering near its interim resistance of 7.20 and unless a sustained break past it is seen, it may continue to move within a narrow region of 7.20-7.18 in the near term. Watch price action around 7.20 for a possible upside break.

Aussie (0.6530) looks stable above 0.65 for now but a break past 0.655/0.66 is required to continue rising. Else while below 0.66, view remains intact to see a fall towards 0.64-0.635 eventually.

Pound (1.2633) has been slowly rising in the direction of 1.27/28. A dip could be seen from 1.27 in the near term.

USDINR (82.9725) tested 82.9350 before closing slightly higher yesterday at 82.9725. While below immediate resistance at 83.10, the pair could attempt to test 82.80 with an immediate range of 83.10-82.80 to hold for the near term. RBI policy meeting today could bring in some volatility in the pair. The central bank is expected to keep rates unchanged.

EURINR (89.4757) is rising in line with our expectations and could move up towards 89.80/90. Thereafter, it can fall back towards 89/88 while below 90.

The US Treasury and the German yields have inched up. We repeat that the key resistances ahead on both the US Treasury and the German yields can cap the upside and trigger a fresh fall. That will keep the broader downtrend intact. The 10Yr GoI is still stuck inside a narrow range. Bias is negative to break the range on the downside and fall further. The 5Yr GoI looks mixed and can go either way from here. It is a wait and watch situation. The outcome of the RBI meeting today will need a close watch as it can cause volatility.

The US 10Yr (4.12%) and the 30Yr (4.33%) have bounced back again. We expect the resistances at 4.2% (10Yr) and 4.4% (30Yr) to cap the upside and keep the broader downtrend intact for the yields to fall back towards 4% (10Yr) and 4.2% (30Yr).

The German 10Yr (2.31%) and the 30Yr (2.54%) yields have risen back but may not sustain. While below 2.35% (10Yr) and 2.6% (30Yr) the yields are likely to fall towards 2% (10Yr) and 2.2%-2.1% (30Yr) going forward.

The 10Yr GoI (7.0723%) has dipped within its narrow 7.06% and 7.1% range. Resistances are at 7.1%-7.12% and then at 7.2%. While they hold, the view is bearish to see 6.9%-6.8% on the downside.

The 5Yr GOI (7.0068%) hovers around 7% and looks mixed. A break above 7.04% can take it up to 7.1% while a fall below 6.95% can drag it to 6.8%. Wait and watch.

Dow Jones and Nifty have scope to rise towards their crucial resistance in the near term from where a corrective fall can be seen. DAX has fallen back failing to sustain the break above 17000 but might get support at 16800 which will keep our bullish view intact. Nikkei has broken sharply on the upside of its sideways range and can now head towards its resistance at 37000 before a fall back can be seen. Shanghai has key resistances ahead which may halt the current rally and keep the broader downtrend intact.

Dow (38677.36, +0.40%) continues to move up. This keeps intact our view of seeing 39000-39300 on the upside. Thereafter a strong correction can be seen.

DAX (16921.96, -0.65%) has come down, failing to sustain the break above 17000. This has put the index back into the 16800-17000 range. So, the expected rise to 17500 may get delayed now.

Nifty (21930.50, +0.01%) can test 22150 and a break above it can take it further up to 22500. Thereafter a correction is possible.

Nikkei (36727.50, +1.72%) has broken sharply above the upper end of the 36500-35500 range. A rise towards 37000 looks possible. If that holds, a fall back to 36000 can be seen. A rise past 37000 is needed to become bullish towards 38000.

Shanghai (2850.31, +0.73%) is heading towards its key resistance at 2870-2900-2920. While these holds, a fall back towards 2700 or lower is possible.

Brent and WTI can test $ 80-81 and $ 76 respectively before a fall back can be seen from there. However, a break above these levels, if seen, could negate our bearish view. Gold has room to rise while above the support at 2025-2020. Silver is heading down towards its crucial support which could hold and produce a bounce back. Natural Gas and Copper have broken below their key supports and look vulnerable to come down further in the near term.

Brent ($ 79.56) has risen above $ 79 and can see a test of $ 80-81 as expected. Thereafter it may turn down towards $ 75-73. However, if it happens to break above $ 81, could negate our bearish view and lead to a rise towards $ 83-84.

WTI ($ 74.26) has risen above $ 74 and can head towards $ 76 as expected. From there, a fall can be expected towards $ 70-68. Only a decisive break above $ 76, if seen, will negate our bearish view and rise towards $ 78-80.

Gold (2052.30) looks ranged within 2040-2060. Chances of rise towards 2080-2100 are still there while it remains above the support at 2025-2020.

Silver (22.29) is heading lower towards 22. That could hold and lead to a rise towards 23 or maybe even higher towards 23.50-24.00.

Copper (3.7490) has broken below the support at 3.75. This is contrary to our view to see a rise towards 3.85 while above 3.75. It can come down towards 3.70-3.60 in the near term. Thereafter, a bounce back can be seen towards 3.80.

Natural Gas (1.9750) has broken below the lower end of 2.20-2.00 range. While this break sustains, a further fall towards 1.7-1.5 can be seen. After that, a rise towards 2.0 is possible.

4:30 10:00 RBI Repo Rate
Expn – …Expected 6.50% …Previous 6.50%

4:30 10:00 RBI Rev Repo Rate
Expn – …Expected – …Previous 3.35%

4:30 10:00 RBI MSF
Expn – …Expected – …Previous 6.75%

DATA YESTERDAY
—————
22:30 04:00 AU PMI
Expn -26.8 …Expected – …Previous -25.3 …Actual -23.8

13:30 19:00 US Trade Balance
Expn – …Expected -62.3$ Bln …Previous -61.9$ Bln. …Actual -62.2$ Bln.