The Dollar Index continues to remain ranged within 104.50-103.60 region. Watch US NFP and Unemployment data releases scheduled today. Euro tested 1.09 as expected before coming down. EURJPY and USDJPY are moving higher within their respective ranges of 168-170 and 154-156.50. USDCNY may remain stable below 7.25. Aussie and Pound are trading below their crucial resistance of 0.67 and 1.28 respectively and can soon dip if a break past it is not seen. EURINR is headed back to 91-91.25 but while below 91.25, it can trade within 89.50-91.25 region. USDINR is likely to sustain trade within 83/83.20-83.60 region.

We expected Dollar Index (104.093) to test 103.80-103.60 on the downside, instead it continued to sustain above 104. We may continue to expect a narrow range of 104.50-103.60 to hold for now. US NFP and Unemployment data release is schedule today which could bring in some volatility.

EURUSD (1.0896) tested 1.09 as expected after the ECB cut 25bps yesterday, in line with market expectations. Currently it is holding well within its overall range of 1.0950-1.08 and unless a decisive break can be seen on either side, it can persist for a while with some chances of an extension to 1.10.

Dollar-Yen (155.80) is moving higher within its near term range of 154-156.50.

EURJPY (169.77) is nearing the upper end of its immediate range of 168-170. Thereafter, only a break above 170 will pave the way for 171-172 in the medium term. The downside is expected to be limited to 168-167 for now.

USDCNY (7.2449) continues to remain steady below 7.25 while downside is likely to be limited to 7.24-7.23.

Aussie (0.6668) has recovered well from the yesterday’s low of 0.6633 and is headed towards the resistance near 0.6680-0.67. While the resistance holds, it is likely to trade within 0.6580-0.6720 region. Unless a strong break past 0.6720 or below 0.6580 is seen, the pair may continue to trade within the mentioned near-term range.

Pound (1.2790) failed in its attempt to sustain above 1.28 and has declined back within its narrow range of 1.26-1.28 which can persist for a while.

USDINR (83.4775) had risen well yesterday but crucial resistances still hold at 83.55/60 below which, the pair is likely to continue trading within 83.60-83.20/83.00 for the near term unless a decisive breakout is seen.

EURINR (90.9626) is again headed towards 91-91.25, but a strong break past it will be needed to make the outlook bullish towards 92 in the medium term. Until then, its earlier range of 89.50/90-91/91.25 is likely to hold for some time.

The US Treasury yields remain stable. The yields have room to fall further from here in the coming days. The German yields have bounced slightly. The broader trend remains up. But an intermediate fall is still alive before a rise happens. The ECB cut their policy rates by 25 bps as was widely expected by the market. The 10Yr and the 5Yr GoI have come down further. They are back into their earlier sideways range and can fall within it.

The US 10Yr (4.30%) and the 30Yr (4.44%) yields remain stable. The yields can fall to 4.2%-4.1% (10Yr) and 4.35%-4.25% (30Yr) before they reverse higher again.

The German 10Yr (2.55%) and the 30Yr (2.67%) yields have risen back slightly. A fall to 2.45%-2.4% (10Yr) and 2.6%-2.55% (30Yr) cannot be ruled out in the near-term before the broader uptrend resumes to target 2.8%-2.9% (10Yr) and 3% (30Yr) over the medium-term.

The 10Yr GoI (7.0610%) and the 5Yr GOI (7.0355%) have dipped further. The yields are back into their 7%-7.1% range and are likely to move down towards the lower end of the range.

Dow Jones has moved up towards 39000 as expected. It has to rise past 39000 for increased bullishness, else can fall back towards 38500-38000. DAX has risen further after ECB cut rates by 25bp and looks bullish for the near term. Nifty sustains above 22500 and while above that, a further rise can be seen in the near term. Nikkei lacks strength to rise past 39000 but can soon break above it and target further highs. Shanghai has broken below the support at 3050 and while this break sustains, a further dip to 3000 can be seen.

Dow (38886.17, +0.20%) continues to move up but slowly. We reiterate that a strong break above 39000 is needed to strengthen the bullish case to revisit 40000 levels. A reversal from around 39000 can drag it down to 38000 again. Still, wait and watch.

DAX (18652.67, +0.41%) has moved up further and keeps intact our bullish view of seeing 19000 and higher levels. A break above 18850 can take it higher. Supports are at 18400 and 18200.

Nifty (22821.40, +0.89%) is holding higher. The bullish view of seeing a rise to 23250-23500 is intact. Immediate support is at 22500. Below that 22000-21800 is the next strong support.

Nikkei (38686.50, -0.15%) has dipped failing to rise past 39000. Bias remains positive to see a break on the upper side of the 38000-39000 range and rise towards 40000 in the coming days.

Shanghai (3040.26, -0.28%) has broken below 3050 contrary to our view that 3050 will hold and lead to a bounce towards 3130-3150. While this break sustains, a further dip towards 3000 is possible.

Brent and WTI have risen further and a break above $ 80 and $ 76, if seen, would open doors for further upside and will reduce the danger of falling towards $ 75-74 (Brent) and $ 70 (WTI) respectively. Gold is hovering below its upper end of the range. Need to see it it breaks higher or not. Silver and Copper can rise towards 32-33 and 4.8-4.9. Natural Gas to trade sideways between 3.0-2.5 for a while.

Brent ($ 79.92) is attempting to break above $ 80. A sustained rise past $ 80 can take Brent higher towards $ 82-83 and that would reduce the chances of fall towards $ 75-$ 74.

WTI ($ 75.62) has risen towards $ 76. A break above it, if seen, can take WTI higher towards $ 78-79 and that would reduce the danger of falling towards $ 70.

Gold (2387.80) lacks strength to rise past 2400. A decisive break above 2400, if seen, can target 2450 and then a corrective dip towards 2350 can be seen. Else it can continue to trade within the 2400-2300 range for some more time.

Silver (31.26) has risen sharply above 31. While above 31, a rise towards 32-33 could be seen. This has reduced the chances of fall towards 29.00-28.50 that we had mentioned earlier.

Copper (4.6540) has moved up towards 4.7 and can rise further 4.8-4.9 while above 4.6-4.5.

Natural Gas (2.8310) is heading up towards 2.90. A rise past 3.0 looks unlikely at the moment. We expect a broad range of 3.0-2.5 to hold for a while.

4:30 10:00 RBI Repo Rate
Expn 6.50% … Expected 6.50% … Previous 6.50%

4:30 10:00 RBI Rev Repo Rate
Expn 3.35% … Expected – … Previous 3.35%

4:30 10:00 RBI MSF
Expn 6.75% … Expected – … Previous 6.75%

9:00 14:30 EU GDP
Expn – … Expected 0.3% … Previous 0.33%

12:30 18:00 US NFP
Expn 241K … Expected 185K … Previous 175K

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

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

12:30 18:00 US Average Hourly Earnings Production & Non Supervisory Employees
Expn 0.3 … Expected – … Previous 0.2

12:30 18:00 CA Labour Force
Expn – … Expected 27.8K … Previous 90.4K

Data Yesterday
…………..
1:30 07:00 Australia Trade Balance
Expn – … Expected 5.5 … Previous 4.8 …Actual 6.5

9:00 14:30 EU Retail Sales
Expn 0.0% … Expected 0.2% … Previous 0.7% …Actual -0.5%

12:15 17:45 ECB Mtg
Expn 4.50% … Expected 4.25% … Previous 4.50% …Actual 4.25%

12:30 18:00 US Trade Balance
Expn – … Expected -69.8 … Previous -68.6 …Actual -74.6