The dollar Index could not stay above 105 and can now test 104.50 on the downside before attempting to rise back. Euro tests support at 1.08 and has bounced well from there. EURJPY and USDJPY looks bullish towards 172 and 158-159 respectively but could face an interim dip in the near term before rising. USDCNY is headed towards 7.25/26. Aussie and Pound have recovered well from their respective lows of 0.6597 and 1.2676 and can rise to 0.67 and 1.28 respectively in the longer run. EURINR can now rise back towards 90-91 in the coming sessions. USDINR can bounce from crucial support at 83.

Dollar Index (104.695) failed to sustain its rise past 105 and has declined a bit from testing 105.11 itself. It can now test 104.5 before bouncing back towards 106-106.50 in the medium term. Only a strong break below 104 if seen would make the outlook bearish further towards 103.

EURUSD (1.0849) held the support of 1.08 quite well and has risen above it. A test to 1.085 was seen as expected and now if sustained, can extend its rise towards 1.09 in the coming sessions. Above 1.08, the overall view remains bullish.

While Dollar-Yen (156.70) remains muted below our target of 158, EURJPY (170.02) has risen above our expected level of 170. Both pairs could face some interim corrections before attempting to rise further towards 158-159 and 172 in the longer run.

USDCNY (7.2444) continues to remain bullish towards resistance near 7.25/26 while above 7.24.

Aussie (0.6633) has recovered well from the low of 0.6592, contrary to our expectations of seeing a fall towards 0.6550. While above 0.66, it can reattempt to rise towards 0.6650/0.67. Only a decisive break below 0.66 if seen, can bring 0.6550 back into the picture.

Pound (1.2740) has been rising slowly and while above 1.27, there is scope for an eventual rise to resistance at 1.28 before getting rejected from there in the medium term.

USDINR (83.1025) was expected to bounce from 83.15/20 towards 83.30/40/50, but instead the pair slipped sharply on Friday from 83.28 to 83.02 on the downside. Immediate support is at 83 which can hold and push USDINR towards 83.35-83.40 soon.

EURINR (90.144) reversed from 89.8569 itself and now if sustained, can rise back towards 90.50-91 in the coming sessions. We expect the downside to be limited to 89.50.

The US Treasury yields remain stable. They have to breach their immediate resistances to move further higher and avoid falling back. The US markets are closed today. The German yields have also dipped slightly. Key resistances are near current levels which have to be broken to avoid a corrective fall and get an extended rise. The 10Yr and 5Yr GoI have bounced slightly. The support is holding well. A sideways consolidation above this support is possible before a fresh rise happens.

The US 10Yr (4.46%) and the 30Yr (4.57%) yields remain stable. The US markets are closed today. 4.5% (10Yr) and 4.6% (30Yr) have to be broken to get a rise to 4.6% (10Yr) and 4.7%-4.8% (30Yr). Else a fall back to 4.2%-4.1% (10Yr) and 4.4%-4.3% (30Yr) can be seen.

The German 10Yr (2.58%) and the 30Yr (2.69%) yields have dipped slightly. A decisive break above 2.6% (10Yr) and 2.7% (30Yr) can take the yields up to 2.8%-2.9% (10Yr) and 3% (30Yr). Else a corrective fall is possible.

The 10Yr GoI (7.0455%) and the 5Yr GOI (7.0272%) have bounced slightly. 7% is an important support. While that holds, a consolidation between 7% and 7.1% is possible for some time before a rise to 7.2%-7.3% (10Yr) and 7.2% (5Yr) happens. This view will go wrong if the yields break below 7% decisively.

Dow Jones and DAX look vulnerable to fall towards their immediate support before a bounce back can happen. Although Nifty has room to rise towards 23200, but we need to be cautious as 23000-23200 are decent resistance zone and we might see a profit taking. Nikkei has recovered a bit and may look to rise in the near term while above the support at 38000. Shanghai has fallen below 3100 and can fall further towards 3050 and then a bounce can be seen.

Dow (39069.59, +0.01%) looks vulnerable to break 39000 and fall to 38500. After that, the Dow can rise back again. The US markets are closed today.

DAX (18693.37, +0.01%) looks likely to test 18400-18200 before the expected rise to 19200 happens.

Nifty (22957.10, -0.05%) has come-off from a high of 23026. There is room to test 23200. But after that, a reversal to 22800 and lower cannot be ruled out. Be cautious.

Nikkei (38687.50, +0.19%) has bounced back a bit. For now, the support at 38000 is holding. While 38000 holds, the chances of a rise towards 40000 will remain there.

Shanghai (3098.19, +0.30%) has dipped below 3100. This has delayed the chances of seeing a test of 3200. It may now fall to 3050 before a bounce towards 3150-3200 can be seen.

Most of the commodities have recovered except Natural Gas. Crude prices have bounced back a bit but the broader outlook will remain bearish for a fall while below resistance at $ 85 (Brent) and $ 80 (WTI) respectively. Gold and Silver fall have stalled but they need to surpass the resistance overhead to bring back the bullishness and to avoid the danger of falling again. Copper has managed to sustain above support at 4.70. While above 4.70, a bounce back can happen soon. Natural Gas has fallen as expected and may come down to test its immediate support. Thereafter we need to see if it bounces back or breaks lower.

Brent ($ 82.27) and WTI ($ 77.97) have bounced back after testing a low of $ 80.65 (Brent) and $ 76.15 (WTI). The overall view remains bearish for a fall towards $ 80-75 and $ 75-70 while below the resistance at $ 85 (Brent) and $ 80 (WTI) respectively.

Gold (2341.20) fall has stalled at 2325. However, it has to rise past 2350 to bring back the bullishness. Else it would be vulnerable to fall to 2300-2285. A break below 2285, if seen, can be further bearish towards 2250.

Silver (30.76) has bounced back after testing 30.24 contrary to our view for a break below 30.00. It has to rise above 31.00 to become bullish towards 32-33. Else it would remain vulnerable to a break below 30 and fall towards 29.

Copper (4.7685) remains lower but has managed to hold above the support at 4.7. While 4.7 holds, a bounce towards 5.00 is possible. A break lower, if seen, would be vulnerable to a further fall towards 4.5-4.4.

Natural Gas (2.7570) has fallen below 2.8 as the resistance at 3.00 has held well as expected. A dip towards 2.65 looks possible. Thereafter we need to see if it bounces back or breaks lower.

8:00 13:30 GER IFO Business Climate
Expn 89.3 … Expected 90.4 … Previous 89.4

8:00 13:30 GER IFO Business Situations
Expn 88.0 … Expected 89.9 … Previous 88.9

8:00 13:30 GER IFO Business Expectations
Expn 89.3 … Expected 90.5 … Previous 89.9

Data Friday
…………..
23:05 04:35 UK Cons Conf
Expn -17 … Expected -18 … Previous -19 …Actual -17

23:30 05:00 JP CPI
Expn 2.9 … Expected 2.2 … Previous 2.7 …Actual 2.5

12:30 18:00 US Durable Goods Orders
Expn 0.9% … Expected -0.5% … Previous 0.8% …Actual 0.7%