The Dollar Index remained stable yesterday above 103, while EURUSD continues to move within 1.09-1.0950 region. The USDJPY and EURJPY had risen a bit but while below 148/148.50 and 162/163 respectively, they can resume their downtrend in the medium term. Pound is holding below the immediate resistance around 1.2780/28 and failure to rise past current levels, can trigger a fall towards 1.26. The Aussie needs to break above 0.66 to turn bullish, else can remain ranged within 0.66-0.6450/64 for some time. USDCNY can attempt to rise towards 7.20 if it sustains above 7.18. EURINR could test the supports near 91.50 and 91 before possibly bouncing back towards 92. USDINR could see a dip to 83.85/80 before attempting to rise back towards 84 again in the medium term. Watch out for the US PPI release scheduled today.

Dollar Index (103.121) remained stable yesterday with a slight dip, while EURUSD (1.0934) has been oscillating between 1.09-1.0950 region. The Dollar Index could fall towards 103 or lower towards support at 102 with upside curbed at 103.70/104 while Euro looks bullish above 1.09 for now with possible downside extension to 1.0850. Watch the US PPI scheduled today and the US CPI tomorrow.

Dollar-Yen (147.37) and EURJPY (161.16) had appreciated yesterday, but overall are holding well below our mentioned levels of 148.50 and 162/163 respectively. For now, the view remains intact to see a fall back to 145 and 158/157 either from current levels or upon testing 148.50 and 162/163.

The USDCNY (7.1803) had reversed from the high of 7.1825 yesterday to close at 7.1739 but has risen again today. A sustained trade above 7.18 could take it higher towards 7.20 in the near term. Overall, a near-term range of 7.1860-7.16 can persist for a while.

Pound (1.2771) is currently holding below the immediate resistance around 1.2780/1.28. The pair must sustain above current levels and rise past 1.28 to negate near-term bearishness. Else, any break below 1.2750 can trigger a fall towards 1.26 or even lower before bottoming out.
Aussie (0.6590) can trade within 0.66-0.6450/6400 for some time. A decisive break past 0.66 will be needed to extend its rise further to 0.6650-0.67.

USDINR (83.96) is holding below the crucial resistance of 84. For now, we are retaining our view of seeing a near-term dip to 83.85/80 before it attempts to rise back towards 84. However, a break past 84 if seen earlier can trigger strong bullishness ahead. We wait for a confirmation at 84.

EURINR (91.7964) has been moving within a narrow range of 91.50-92 region. While the support around 91.50-91.00 holds, the view remains bullish to 92 and higher in the near term.

The US Treasury yields have dipped further. The reversal after testing the resistance is sustaining well. That keeps intact our bearish view of seeing more fall from here. The US CPI data release tomorrow will be important to watch. The German yields remain lower and stable. The downtrend is intact, and the yields have more room to fall. The 10Yr GoI is still stuck inside the narrow range. The bias is bearish to break the range on the downside and fall eventually.

The US 10Yr (3.91%) and the 30Yr (4.21%) yields have dipped further. The resistances at 4% (10Yr) and 4.3% (30Yr) have held well as expected. While below 4% (10Yr) and 4.3% (30Yr), a fall to 3.85% (10Yr) and 4.1% (30Yr) initially and then 3.5% (10Yr) and 3.8% (30Yr) eventually over the medium-term can be seen.

The German 10Yr (2.22%) and the 30Yr (2.45%) yields remain stable. The trend is down, and the yields can fall to 2% (10Yr) and 2.2% (30Yr) on the downside. Resistances are at 2.4% (10Yr) and 2.6% (30Yr).

The 10Yr GoI (6.8801%) has bounced slightly within its 6.85%-6.9% range. Bias is bearish to break below 6.9% and fall to 6.8%-6.75%.

Dow Jones has dipped slightly but still has chance of seeing a test of 39800-40000 on the upside before turning lower from there. DAX and Nikkei has scope to rise to 18000-18200 and 37000 before a fall back can takes place. Nifty to trade within 24500-24000 range for a while. Shanghai remains vulnerable to break below 2850 and fall towards 2835-2800.

Dow (39357.01, -0.36%) has dipped slightly. The immediate outlook is mixed. There is still a chance of rising to 39800-40000 before reversing lower again. A fall below 39000 will negate that chance and drag it down to 38200 straight away.

DAX (17726.47, +0.02%) can see a corrective rise to 18000-18200. Thereafter it can resume the downtrend and target 17000-16800 in the coming weeks.

Nifty (24347, -0.08%) has come-off from a high of 24472. A range of 24000-24500 is in place now. While below 24500, the bias remains negative to break 24000 and fall to 23500-23300.

Nikkei (35,805.00, +2.23) continues to rise and can target 37000 in the near term. After that, a fall back might be seen towards 35000.

Shanghai (2857.91, -0.01%) remains stable above 2850. For now, the 2900-2850 range remains intact. It looks bearish for a break below 2850 and fall towards 2835-2800.

Brent and WTI have risen sharply yesterday following the escalating tensions in the Middle east as there are fears that Iran could attack Israel. Gold, Silver and Copper have bounced back well and look bullish for the near term. Natural Gas has dipped slightly but downside could be limited to 2.1-2.0.

Brent ($ 81.58) rose sharply to $ 82.40 yesterday in line with expectations for a rise towards $ 80-82 and has come down a bit from there. A break above $ 82.50 is needed to open doors for further rise towards $ 85-86. Else it could fall back towards $ 81-80.

WTI ($ 79.40) tested $ 80.18 yesterday as expected before falling back a bit from there. A rise past $ 80, if seen, can target $ 82-83. Else it may fall back towards $ 78.

Gold (2506.10) has risen above 2500 and tested a high of 2517 so far in line with expectations. A further rise towards 2550-2580-2600 looks possible before a pause can be seen.

Silver (27.89) has risen back and is attempting to break above 28. A rise towards 29.00-29.50 looks possible while above 26.50-26.00.

Copper (4.0465) has bounced back above 4.00 as the support at 3.90 seems to be holding well. A rise towards 4.2-4.3 looks likely while it stays above 3.90-3.85.

Natural Gas (2.1620) has dipped slightly after testing a high of 2.2560. Immediate support is seen near 2.1-2.0 region. If that holds, a break above 2.23/2.25 and rise towards 2.4-2.5 could be seen.

6:00 11:30 UK Unemp
Expn 4.6% …Expected 4.5% …Previous 4.4%

12:30 18:00 US PPI
Expn 0.2% …Expected 0.2% …Previous 0.2%

12:30 18:00 US PPI ex Food & Energy (MoM)
Expn 0.5 …Expected 0.2 …Previous 0.4

Data Yesterday
…………..
12:00 17:30 IN IIP
Expn 8.1% …Expected 5.5% …Previous 6.2% …Actual 4.2%

12:00 17:30 IN CPI
Expn 3.82 …Expected 3.65 …Previous 5.08 …Actual 3.54