The dollar Index needs to bounce back from current levels to test 105+ on the upside, else it can fall towards 104, while Euro is headed towards 1.09. EURJPY looks bullish towards 172 while USDJPY looks muted below 158/157. USDCNY is headed towards 7.25/26. Aussie and Pound can soon rise to 0.67 and 1.28 respectively before topping out. EURINR can now rise back towards 90-91 in the coming sessions. USDINR above 83, has potential to rise back towards 83.35/40 in the near term.

Dollar Index (104.457) has dipped, breaking below our expected level of 104.50. A test of 104 looks likely in the near term from where a bounce can be expected.

EURUSD (1.0874) has been rising well over the last 3-sessions holding above support at 1.08. A test of 1.09 is possible in the next few sessions. Overall movement within the narrow 1.08-1.09 and broad 1.0750-1.0950 is likely to hold for sometime.

While Dollar-Yen (156.70) has halted its rise near 157 on Dollar weakness seen over the last 3-sessions, EURJPY (170.38) has been inching up towards our next target of 171.50-172. Dollar Yen could stay muted below 158/157.

USDCNY (7.2459) continues to remain bullish towards resistance near 7.25/26 while above 7.24.

Aussie (0.6665) and Pound (1.2779) are rising in line with our expectations and can soon test 0.67/0.6730 and 1.28 respectively on the upside before possibly topping out for the near term.

USDINR (83.1350) is currently holding well above its immediate support at 83 and while it sustains, a potential rise to 83.35-83.40 could be seen in the near term.

EURINR (90.3863) looks bullish towards 90.50-91 in the near term. The downside is expected to be limited to 89.50.

The US Treasury yields have to break their immediate resistance to move higher and avoid a fall. It is a wait and watch situation. The resistances on the German yields are holding well. A corrective fall looks likely in the near-term within the overall uptrend. The 10Yr and 5Yr GoI are holding well above their supports. We can expect a consolidation before they move up again.

The US 10Yr (4.46%) and the 30Yr (4.57%) yields have to break4.5% (10Yr) and 4.6% (30Yr) to move up to 4.6% (10Yr) and 4.7%-4.8% (30Yr). Else they can fall back to 4.2%-4.1% (10Yr) and 4.4%-4.3% (30Yr).

The German 10Yr (2.55%) and the 30Yr (2.67%) yields have dipped further. The resistances at 2.6% (10Yr) and 2.7% (30Yr) are holding well now. A test of 2.5% (10Yr) and 2.6% (30Yr) looks likely now. The above-mentioned resistances have to be broken to get an extended rise to 2.8%-2.9% (10Yr) and 3% (30Yr).

The 10Yr GoI (7.0329%) and the 5Yr GOI (7.0230%) have dipped but are holding well above 7%. While above 7%, a range of 7%-7.1% can be seen 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 was closed yesterday. DAX and Shanghai have bounced back contrary to our view and might extend the bounce further. Nifty has key resistance at 23200 which if holds, can lead to a corrective fall. Nikkei lacks a follow through rise but bias is positive to see a rally towards 40000 while above 38000.

Dow (39069.59) was closed yesterday. It looks vulnerable to break 39000 and fall to 38500 before rising back again. We will have to wait and watch.

DAX (18774.71, +0.44%) has risen back. It keeps intact our bullish view of seeing 19200 on the upside. The intermediate fall to 18400-18200 mentioned yesterday may not happen.

Nifty (22932.45, -0.11%) seems to be struggling to get a sustained rise above 23000. It has to hold above 22800 to keep alive the chances of seeing 23200 on the upside. A break below 22800 will negate that rise and drag the Nifty down to 22500 and lower. As mentioned yesterday, be cautious and watch the market.

Nikkei (38833.50, -0.17%) lacks strength to rise past 39000. However, bias is positive for a break above 39000 and rise towards 40000 while above 38000.

Shanghai (3126.57, +0.08%) has bounced back towards 3130 contrary to our view to see a fall towards 3050. If the bounce sustains, it may rise towards 3150-3200.

Crude prices have extended the bounce but needs to overcome the resistance at $ 85 (Brent) and $ 80 (WTI) respectively to bring back the bullishness. Else can remain vulnerable to a fall. Gold and Silver have risen above their resistance and while this break sustains, a further rise can be seen in the near term. Copper is holding well above support at 4.70. While above 4.70, a rise towards 5.00 looks possible. Natural Gas can come down to test its immediate support. Thereafter we need to see if it bounces back or breaks lower.

Brent ($ 83.24) continues to move up. It has to surpass $ 85 to bring back the bullishness. Else it may trade within $ 85-80 for some time before a fall can be seen towards $ 75.

WTI ($ 78.85) has risen further above $ 78.50. It has to rise past $ 80 to become bullish towards $ 82 or higher. Else it may trade within $ 80-76 for some time before a fall can be seen towards $ 70

Gold (2341.20) has risen above the resistance at 2350. While this break sustains, a further rise towards 2375-2400 could be seen. This has reduced the chances of fall towards 2300-2285.

Silver (31.96) has surged towards 32.00 breaking above 31.00. It looks likely to move up further towards 33-34.

Copper (4.86) has moved up to 4.86 as the support at 4.7 has held well. While above 4.7, a further rise towards 5.00 is possible.

Natural Gas (2.7750) can dip to 2.65-2.60. Thereafter we need to see if it bounces back or breaks lower.

13:00 18:30 US Case Schiller
Expn 6.5% … Expected 7.3% … Previous 7.3%

14:00 19:30 US Cons Conf
Expn 95.0 … Expected 96.1 … Previous 97.0

Data Yesterday
…………..
8:00 13:30 GER IFO Business Climate
Expn 89.3 … Expected 90.4 … Previous 89.3 …Actual 89.3

8:00 13:30 GER IFO Business Situations
Expn 88.0 … Expected 89.9 … Previous 88.9 …Actual 88.3

8:00 13:30 GER IFO Business Expectations
Expn 89.3 … Expected 90.5 … Previous 89.7 …Actual 90.4