Volatility seeped in on Friday as the US NFP came lower at 175K than the previous of 315K and the unemployment rate came higher at 3.9%. The Dollar Index tested 104.50 before becoming stable within its range of 106.50-104.50, while EURUSD rose to 1.08 and may continue to remain ranged within 1.0650-1.0850 for a while. EURJPY and USDJPY look stable above 164 and 152 respectively and can reattempt to rise towards 168 and 154/156 in the medium term. Aussie has been rising as expected and can reverse after testing resistance near 0.67/6750 while above 0.66. Pound rose sharply to test 1.2634 before slipping down Below 1.26, it can fall towards 1.24. USDCNY plunged sharply and could be headed towards 7.20/18 if no immediate reversal is seen over today and tomorrow. EURINR is back within its range of 88.50–89.50/90 after testing 90.1937 on the upside. USDINR may trade between 83.30 and 83.50/55 this week.

Dollar Index (105.088) tested the lower support near 104.50 as expected post the release of lower US NFP & higher Unemployment data which came at 175k and 3.9% respectively. A range of 106.50-104.50 is likely to hold for the near term.

EURUSD (1.0768) tested 1.08 on the upside before coming down. There is scope for a rise to 1.0850 in the near term. However, an immediate range of 1.0650-1.0850 is likely to hold in the medium term.

Dollar-Yen (153.69) tested 151.89, slightly lower than our mentioned support near 152 before the pair bounced back to current levels. While above 152, the pair can attempt to rise to 155-156 before falling back towards 152 again in the medium term.

EURJPY (165.48) has bounced well from 164 and did not see a fall to 162 that we had expected. A sustained rise above 164 can take the pair back to 168 soon.

USDCNY (7.2132) plunged to 7.2068 on weak US Dollar post NFP data release. The fall has been contrary to our expectation of seeing trade between 7.2350-7.25. Now, if there is no immediate recovery seen from current levels, the pair could turn bearish towards 7.20/18.

Aussie (0.6618) has broken past 0.66 and can now rise towards 0.67-0.6750 which is a near-term resistance as seen on the weekly charts. While the mentioned resistance holds, a decline back to 0.65 can be possible by the end of May-24.

Pound (1.2549) tested 1.2634 before coming down to close below 1.26. Note that 1.26 is an immediate resistance which if holds can push the Pound down to 1.24 or lower eventually. Else, a break above 1.26, if seen and sustained can take it towards upper resistance at 1.28.

USDINR (83.4275) is likely to trade within the 83.30-83.50/55 region this week.

EURINR (89.8258) had risen slightly above our expected range of 88.50-90 to test 90.1937 on the upside. Currently it is back within the range and unless a decisive break can be seen on either side, the range may persist for a while.

The US Treasury and the German yields continue to move down. The Treasury yields were dragged down after the US NFP and Unemployment data release. The US added 175K to the non-farm payroll, less than market expectation of 243K. The unemployment inched up to 3.9% from 3.8%. Both the Treasury and the German yields have room to fall further from here before a fresh rise happens. The 10Yr and 5Yr GoI are also coming down. They can fall further to test their supports and then resume their overall uptrend.

The US 10Yr (4.52%) and the 30Yr (4.67%) yields have declined sharply. come down. The test 4.5% (10Yr) is happening much faster than expected. A break below 4.5% can drag the 10Yr down to 4.4%-4.35%. The 30Yr has dipped below 4.7% and can fall to 4.6%.

The German 10Yr (2.49%) and the 30Yr (2.62%) yields continue to fall in line with our expectation. The 10Yr can test 2.4% and the 30Yr can fall to 2.5% on a break below 2.6%. Thereafter a fresh rise is possible.

The 10Yr GoI (7.1470%) and the 5Yr GOI (7.1537%) continues to fall. The 10Yr has dipped below 7.15% and can test 7.1%. The 5Yr has room to see 7.12% on the downside. After this fall, the yields are likely to reverse higher again and resume the broader uptrend targeting 7.3% (10Yr) and 7.3%-7.4% (5Yr).

Dow Jones has risen, breaking above upper end of the sideways range. While this break sustains, a further rise looks possible in the near term. Dax and Nifty looks mixed and are likely to trade sideways for a while. Nikkei is closed. Shanghai can rise towards its key resistance before a corrective fall can happen.

Dow (38675.68, +1.18%) has risen, breaking the 37500-38500 range on the upside. While this break sustains, a further rise to 39200-39500 is possible this week.

DAX (18001.60, +0.59%) remains stuck within its 17600-18250 range. The immediate outlook is mixed. We expect the DAX to come down within its range. We will have to wait for the range breakout to get clarity.

Nifty (22475.85, -0.76%) has come down sharply on Friday and might test 22200 this week. We can look for a range of 22200-22800 (narrow) or 22000-23000 (broad) for some time.

Nikkei (38236.07) is closed today. We expect the support at 37000 and resistance at 39000 to hold for some time.

Shanghai (3138.08, +1.07%) is heading up towards 3150 as expected. It has scope to test key resistance at 3200 before a corrective fall can be seen towards 3100.

Crude prices are near their key supports, which if hold, can lead to a bounce back soon. Gold looks bearish for the near term. Silver and Copper have bounced but could face resistance at 27.30/50 and 4.60 respectively. Natural Gas has risen towards 2.2 and can rise further to 2.3.

Brent ($ 83.22) lacks a follow through rise above $ 84. A range of $ 82-85 might hold for a while before a bounce can be seen towards $ 87-88.

WTI ($ 78.40) is near the support at $ 78.00-77.70-77.50, while above which, a bounce towards $ 81-82 is possible.

Gold (2317.40) can fall towards 2250-2200 while below 2350.

Silver (27.17) has moved up towards 27.30. While 27.30-27.50 holds, it may dip towards 26.00 or lower.

Copper (4.5930) has bounced above 4.55. Immediate resistance is at 4.60. A break above it, if seen, can lead to a rise towards 4.70-4.80. Else a fall towards 4.30 cannot be ruled out.

Natural Gas (2.15) has risen towards 2.2 as expected. Can rise further to 2.3. A break above 2.3 is needed for increased bullishness towards 2.50-3.00.

5:00 10:30 IN Services PMI
Expn 63.6 … Expected 61.7 … Previous 61.2

Data Friday
…………..
9:00 14:30 EU Unemp
Expn – …Expected 6.5% …Previous 6.5% …Actual 6.5%

12:30 18:00 US NFP
Expn 276K …Expected 243K …Previous 315K …Actual 175K

12:30 18:00 US Unemployment Rate
Expn 3.8% …Expected 3.8% …Previous 3.8% …Actual 3.9%

12:30 18:00 US Avg Hrly Earnings
Expn 0.3 …Expected 0.3 …Previous 0.3 …Actual 0.2

13:30 19:00 US Average Hourly Earnings Production & Non Supervisory Employees
Expn – …Expected – …Previous 0.2 …Actual 0.2