Dollar Index holds above 104 and could move up slowly to 105 while Euro may head towards 1.0820 before reversing towards 1.09. EURJPY and USDJPY continue to move up targeting 170 and 157/158 respectively. USDCNY is headed to 7.24, which if breaks would open door for a rise to 7.25. Aussie may rise if support at 0.6650 holds. Pound may rise to 1.28 if it sustains above 1.27. Sell off seen in USDINR on Friday taking it below 83.40. There is scope for a test of 83.30/25 while below 83.40. EURINR is bearish while below 91.

Dollar Index (104.665) has risen well from 104 since the past few sessions but still a strong break past 105 will be needed to make the outlook bullish towards 106-106.50 in the medium term. On the contrary, a break below 104, if seen can drag it further towards 103 on the downside. Watch price action in the next few sessions.

EURUSD (1.0855) may test 1.0820-1.08 before bouncing back towards 1.09 or higher in the medium term. Bearish sentiments would come in again only on a break below 1.08.

Dollar-Yen (156.44) and EURJPY (169.82) are headed towards our expected targets of 157-158 and 170+ respectively. Thereafter whether the rise gets extended towards 159-160 and 172-173 or not will have to be seen. Watch price action around the mentioned initial targets.

USDCNY (7.2371) tested 7.2403 on the upside as expected before declining a bit. There is still enough room in the chart to rise towards 7.25 but a decisive break past 7.24 will be needed for that. Failure to do so can bring it down to 7.22 in the coming sessions. Watch price action at 7.24.

Aussie (0.6655) is nearing its support around 0.6650 and if that holds, can take it higher towards 0.6750 in the coming sessions. Above 0.6650, the overall view is bullish. A break below 0.6650 may drag it lower towards 0.655 in the medium term.

We had expected Pound (1.2702) is gradually rising towards our mentioned target of 1.28. Thereafter, a corrective fall towards 1.26/24 could be witnessed if the resistance at 1.28 holds in the medium term.

USDINR (83.34) fell sharply on Friday, falling below our mentioned support at 83.40 and closing at 83.34. There could be scope for a further dip to 83.30/25 while below 83.40. Overall resistance near 83.55/57 seems to be holding well for now.

EURINR (90.4465) tested an intra-day low of 90.31 on Friday in line with our bearish view towards 90.50-90.00 in the near term. Currently it has recovered a bit from there but unless a strong break above 91 is seen, the outlook continues to remain bearish.

The bounce seen towards the end of last week on the US Treasury yields is sustaining well. Further rise happened yesterday. A break above the immediate resistance can take the Treasury yields further higher and will reduce the chances of the fall that we were expecting. The German yields continue to rise in line with our expectation. The bullish outlook is intact. The 10Yr and 5Yr GoI have moved up further. A break above the immediate resistance will indicate that a bottom is already in place and will take them higher going forward.

The US 10Yr (4.44%) and the 30Yr (4.58%) yields have risen back well. The 10Yr sustains above 4.35%. A rise above 4.5% is needed to go up to 4.6% and avoid the fall to 4.2%-4.1%. The 30Yr holds well above 4.5% but has to breach 4.6% to go up to 4.7%-4.8% and negate the fall to 4.4%-4.3%.

The German 10Yr (2.53%) and the 30Yr (2.66%) yields are heading up towards 2.6% (10Yr) and 2.7% (30Yr) in line with our expectation.

The 10Yr GoI (7.0925%) has risen further. A rise above 7.1% can take it up to 7.2%-7.3% from here itself. The test of 7.02%-7% may not happen in that case.

Similarly, the 5Yr GOI (7.0791%) can also rise to 7.2% on a break above 7.1%.

Dow Jones struggles to get a follow-through rise above its key resistance. Failure to rise past it can lead to a further fall from here. DAX is stuck in a narrow range but bias is positive to see a break on the upside soon. Nifty remains bullish for the near term. Nikkei has risen above its upper end of the range as expected and looks bullish to target further upside. Shanghai has risen back well and keeps intact the chances of seeing a test of its key resistance. After that, a profit taking can be seen.

Dow (39806.77, -0.49%) seems to be struggling to get a strong follow-through rise above 40000. That keeps the door open for a near-term dip to 39500. Need to see if the corrective fall is extending beyond 39500 towards 39200-39000.

DAX (18768.96, +0.35%) is stuck between 18600 and 18900. Bias remains positive to see a rise to 19200-19300.

Nifty (22502, +0.16) has risen and closed just above 22500 on Saturday. The bias remains bullish for a rise to 22800. Support is around 22350.

Nikkei (39106.50, +0.05%) has risen above the upper end of the 38000-39000 range as expected. A rise towards 40000 or even 41000 looks possible in the near term.

Shanghai (3158.18, -0.41%) has bounced back above 3150. A test of key resistance at 3200 looks possible. After that, a corrective fall can happen towards 3150-3100 (revised from 3100-3000).

Crude prices have dipped slightly after facing rejections near the resistance zone and might remain overall bearish. Metals have fallen back from yesterday’s high but have near-term supports coming up which may hold and produce a bounce back. Natural Gas can test its key resistance soon before a corrective fall occurs.

Brent ($ 83.19) tested $ 84.50 on Monday and has dipped from there. Resistance is at $ 85-86. While these hold, chances of a fall towards $ 80-75 cannot be ruled out.

WTI ($ 78.91) is facing rejections from $ 80. While below $ 80, the chances of a fall towards $ 75-70 cannot be ruled out.

Gold (2417.20) rose to 2454 breaking above 2400 in line with expectations and has dipped slightly from there. Support is at 2400. While that holds, a rise towards 2500 is possible in the near term.

Silver (31.50) rose sharply to test 32.75 on Monday, way beyond our expected level of 31.50, and has dipped from there. Support is at 31. While that holds, there could be chances of further towards 33-34.

Copper (5.0280) did not come down to test 4.80-4.70 as expected. Instead rose to 5.20 and has dipped from there. Immediate support is at 5.00-4.97, while above this, there is scope for a rise towards 5.40-5.45 before a pause can be seen.

Natural Gas (2.7400) has risen sharply above 2.7. Can rise further towards 3.0 in the near term. After that, a dip to 2.8-2.7 can be seen.

9:00 14:30 EU Trade Bal
Expn – … Expected 19.9 … Previous 17.9

12:30 18:00 CA Inflation Y/Y
Expn – … Expected 2.8% … Previous 2.9%

Data Yesterday
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No major data released yesterday.