The Dollar Index could fall towards 103.50-103 if it manages to sustain break below 104 leading to a sharp rise in Euro towards 1.0850-1.09. EURJPY and USDJPY are expected to move towards 164 and 151 respectively before pausing. USDCNY had dipped slightly below its immediate range of 7.20-7.18 but has now risen back. Aussie can rise towards 0.66-0.665 on the upside. Pound can move higher within the 1.25-1.27 range. EURINR could see a short rise to 90-90.5 before eventually coming down towards 89-88 in the medium term. USDINR could trade within the revised range of 82.80-83.00/10 for the rest of the week.

Dollar Index (103.972) has dipped back below 104 while EURUSD (1.0822) continues to trade above 1.08. Both could test 103.50-103 and 1.0850-1.09 respectively in the medium term if immediate reversals are not seen from current levels.

EURJPY (162.80) has been rising gradually above 162 and could soon test our mentioned target of 164-165 in the near term before topping out.

Dollar-Yen (150.39) is inching higher over yesterday and today. A slow rise to 151 looks possible before a rejection is seen from there towards 149 or lower eventually in the longer run.

USDCNY (7.1928) fell below the range of 7.20-7.18 to 7.1782 yesterday but it has now risen back. The pair has been very volatile over the last couple of sessions. However, the support around 7.18 needs to hold strong to lead to a break past 7.20 in the near term. Till then the immediate range may persist.

Aussie (0.6552) had dipped slightly yesterday but while above 0.65-0.6520, a further rise to 0.66 or higher could be seen. The outlook can only turn bearish if a fall below 0.65 is seen. Till then we may consider a broad range of 0.65-0.66.

Pound (1.2639) is slowly moving up and can rise towards 1.27 while above 1.26.

USDINR (82.9750) fell to 82.8650 yesterday breaking below 82.90/88 but could not sustained as it moved up again to close higher for the day. Now immediate resistance is seen at 83.00. A break above it is needed to move up towards 83.10. Else it could trade in a narrow range of 82.90-83.00 and a broad range of 82.80-83.00 for some time.

EURINR (89.7868) has been rising well over the past few sessions and could test 90 on the upside before pausing or moving down again. The immediate range of 90-89 is holding for now.

The US Treasury yields have risen back. The near-term outlook is bullish to see a rise from here before a reversing lower. The US Fed meeting minutes released yesterday has indicated that the central bank will not be in a hurry to start cutting the rates. The German yields have risen sharply. This keeps our bullish view intact to see more rise from here. The 10Yr and 5Yr GoI have come down further and are keeping up our bearish view intact. The yields can fall more from here.

The US 10Yr (4.31%) and the 30Yr (4.47%) yields have inched up. Our view of seeing a rise to 4.4%-4.6% (10Yr) and 4.6%-4.7% (30Yr) remains intact while above 4.2% (10Yr) and 4.4% (30Yr).

The German 10Yr (2.45%) and the 30Yr (2.59%) yields have risen sharply. The 10Yr can head up towards 2.6% while above 2.35%. The 30Yr on the other hand can rise to 2.7%-2.8% on a break above 2.6%.

The 10Yr GoI (7.0533%) continues to fall and keeps intact our bearish view of seeing 7%-6.95% first and then 6.9%-6.8% eventually on the downside. A break below 7.05% can accelerate this fall.

The 5Yr GOI (7.04%) broke below 7.04% but has then come up again from the low of 7.0261. It looks vulnerable to fall towards 7% in the coming days.

Dow Jones and DAX looks consolidative within 38000-39000 and 17000-17200 for now. However, there is scope to see a break on the upside of the range as long as Dow Jones and DAX holds above 38000 and 17000 respectively. Nikkei has bounced back sharply towards its key resistance contrary to our bearish view. We need to see if it able to break above its resistance or not. Nifty falls back sharply yesterday but has near term supports which need to hold to keep our bullish view intact for a test of 22500. Shanghai almost tested it key resistance yesterday and has come off slightly from there. From here, we need to be cautious as the resistance could hold and lead a fall back in the near term.

Dow (38612.24, +0.13%) remains mixed and unclear within its 38000-39000 range. While above 38000 there are chances to see a rise to 39300-39400 first and then a strong reversal.

DAX (17118.12, +0.29%) can rise to 17500 while above 17000. Thereafter the index can turn down and see a corrective fall.

Nifty (22055.05, -0.64%) has come down sharply from a high of 22249. It has to sustain above 22000 in order to keep alive the chances of seeing 22500 first. A fall below 22000 will reduce that chance and take it down to 21800. A further break below 21800 will completely negate that rise and will confirm a reversal.

Nikkei (38860.48, +1.56%) bounced back sharply towards 39000 contrary to our view to see a fall towards 37500-37400. A decisive break above 39000, if seen, can be highly bullish towards 40000. Else it could trade sideways within 39000-38000 for a while. It is a wait and watch situation.

Shanghai (2952.33, +0.05%) saw a high 2994.61 yesterday in line with expectations. 3000 is a crucial resistance level, which if holds, can produce a fall back to 2900-2890. Only a decisive break above 3000, if seen, can lead to an extended rise to 3030-3050 or even 3080.

Brent and WTI have bounce back but the resistance at $ 84-85 and $ 80 respectively are expected to cap the upside and keep our bearish view intact. Gold has scope to test its immediate resistance. Thereafter we need to see if it breaks higher or falls back from there. Copper can fall back either from 3.90 or after testing 3.95. Silver can fall towards the lower end of the 23.50-22 sideways range. Natural Gas continues to inch up and remain bullish for the near term.

Brent ($ 83.05) bounced back from a low of $ 81.66. However, the upside is expected to be capped at $ 84-85 and keep our bearish view intact for a fall towards $ 81-80. A narrow range of $ 85-80 and a broad range of $ 85-75 can persist for some time.

WTI ($ 77.98) recovered from a low of $ 76.32. However, the resistance at $ 80 is expected to cap the upside and keep it ranged within $ 80-75 (narrow) and $ 80-70 (broad) range for some time with a bearish view.

Gold (2037.80) lacks strength to move up above 2040. However, a test of immediate resistance at 2060 is still possible while it remains above 2020. Thereafter, we need to see if it breaks higher or not. A rise past 2060, if seen, can be further bullish towards 2080-2100. Else it could trade sideways within 2060-2000 for some time.

Silver (22.95) continues to dip and may fall towards the lower end of the 23.50-22 sideways range. But broader picture remains bullish to see an eventual break on the upside and rise towards 24-24.50 or even higher towards 25.

Copper (3.8790) saw a high of 3.9085 yesterday in line with expectations. It may or may not rise further towards 3.95. Both 3.90-3.95 are key resistance levels which can hold and produce a fall back towards 3.80.

Natural Gas (1.7610) is rising steadily. Overall bullish for a rise towards 1.9 and then towards 2.0-2.1 in the near term.

10:00 15:30 EU CPI (YoY)
Expn 3.2% …Expected 2.8% …Previous 2.9%

15:00 20:30 US Existing Home Sales
Expn 3673K …Expected 3970K …Previous 3780K

DATA YESTERDAY
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No major data released yesterday.