The Dollar Index initially tested 103.17 on US CPI MoM% release at 0.18%. Immediate support is at 102.50, above which it can bounce back again. The Euro tested 1.09 as expected before recovering a bit from there. Need to see whether 1.09 holds or extends the fall further to 1.08 in the near term. The USDJPY and EURJPY, while above 146 and 161.50, have a fair chance of rising towards 150-152 and 164 respectively in the coming sessions. Aussie looks stable above 0.67 for now, but a further rise past 0.68-0.6850 will be needed to make the outlook bullish again. The pound either needs to rise past 1.31 or break below 1.30 to get further directional clarity. EURINR, below 92-92.50 looks bearish to 91. USDINR continues to remain stable below 84. Any dip below 83.90 can lead to a fall towards 83.80 in the upcoming week. Watch out for IN CPI, IIP and US PPI release scheduled today.

The US CPI MoM% came out higher than expected at 0.18% (0.10%) which led to an initial rise in Dollar Index (102.897) to the level of 103.17 before cooling down a bit. Immediate support is spotted around 102.50. The support needs to hold and produce a bounce, else a break below it can make the outlook bearish in the near term. Watch out for the US PPI release scheduled today.

As expected, EURUSD (1.0934) tested a low of 1.0899 before recovering a bit from there. Watch price action closely around the level of 1.09 to see whether it holds or extends the fall towards 1.08 and lower.

Dollar-Yen (149.24) and the EURJPY (163.24) tested the high of 149.611 and 163.61 respectively before coming down. BOJ Deputy Governor Ryozo Himino’s statement of supporting more rate hikes if the economy moves in line with bank projections led Yen to strengthen a bit. Immediate supports at 146 and 161.50 can be spotted on the charts, above which we are retaining our view of seeing a rise to 150-152 and 164 respectively in the near term before topping out.

USDCNY (7.07) failed to sustain its rise past 7.07 and started coming off from the level of 7.08. China’s finance ministry will detail plans for fiscal stimulus tomorrow which would be important to watch for further directional clarity. If Yuan appreciates, USDCNY can fall back towards 7.05 to 7.00 or even lower. Else, on the upside initial targets could be 7.10-7.1250.

The fall in Aussie (0.6741) appears to have bottomed out at 0.67 for now. A rise past 0.68-0.6850 will be needed to make the outlook bullish again. Else, the ongoing rise could be short-lived.

Pound (1.3059) observed a low of 1.3010 before rising back a bit. The pair will need to see either a rise past 1.31 or a fall below 1.30 to get further directional clarity. A sustained rise past 1.31 can take it towards 1.32 or higher in the near term with immediate downside limited to 1.30-1.29.

USDINR (83.9725) continues to oscillate below the resistance near 84. In the coming week, If the spot moves below 83.90, it can dip to 83.85/80.

EURINR (91.8197) has recovered well from yesterday’s low of 91.52. But while below 92.50-92, the overall view remains bearish towards 91 in the near term.

The US Treasury yields have come-off from their highs on Thursday. The resistances are holding well in line with our expectation. That keeps alive our view of the yields resuming their downtrend from here going forward. The US CPI data came in at 2.41% (YoY) for September, sharply down from 2.59% in August. Though it was higher than the market expectation of 2.3%, the broader trend is still down. That may not disrupt the path of rate cuts from the US Fed, though it might slow down the pace of rate cuts. Broadly, this will be negative for the yields. The German yields remain stable. A strong follow-through rise from here can take them higher. Need to see if they are gaining momentum in the coming days. The 10Yr GoI can consolidate in a range for some time before resuming its upmove.

The US 10Yr (4.06%) and the 30Yr (4.31%) yields have come-off from their highs of 4.12% and 4.41% respectively. So, the resistance at 4.1% (10Yr) and 4.4% (30Yr) have held well. While below 4.1% (10Yr) and 4.4% (30Yr) the yields can fall back to 3.8% (10Yr) and 4% (30Yr) and lower and keep the broader downtrend intact.

The German 10Yr (2.25%) and the 30Yr (2.55%) yields remain stable. Though they sustain above 2.2% (10Yr) and 2.5% (30Yr) a strong follow-through rise from here is needed to take them up to .4% (10Yr) and 2.7% (30Yr). It is a wait and watch.

The 10Yr GoI (6.7775%) has inched up slightly. As mentioned yesterday, it can consolidate 6.7% and 6.85% for some time before resuming the upmove towards 7% over the medium term.

The Dow and DAX eased slightly after their gains in the previous sessions and have closed modestly lower yesterday. However, both indices remain above key support levels at 42000 and 19000, keeping the potential for a rise to 43000 and 19800 intact. Nifty, on the other hand, continues to struggle to break past 25200. A sustained move above 25200 is necessary for the index to gain momentum and advance towards 26000. Otherwise, a pullback to the support at 24800 appears likely. The Nikkei remains above 39500, suggesting a possible attempt to reach 40000. Meanwhile, Shanghai shows weakness and trades below 3300 as investors anticipate further stimulus measures. A dip to 3200/3180 looks possible.

Dow (42454.12, -0.14%) has declined below 42500. But supports are seen at 42200 and 42000 and a deeper one at 41700. The bias is bullish to see a rise to 43000 while these supports hold.

DAX (19210.90, -0.23%) has dipped slightly. The bullish view is intact to see a rise to 19800-20000. Supports are at 19150 and 19000.

Nifty (25130.55, +0.60%) is stuck between 24800 and 25200. The bias is positive to breach 25200 and rise to 25500-25600. Only a fall below 24800 will negate our bullish view and take the Nifty down to 24400 and lower.

Nikkei (39612.71, +0.59%) continues to trade within the range of 38K-40K. A breach of the 40000 level would extend the target on the upside towards 41000. However, failure to rise past 40,000 may result in the index retreating into its sideways trading range of 38k-40k.

Shanghai (3267.24, -1.14%) is holding well below 3400-3300. While below it, a test of 3200/3180 could be possible initially.

Crude prices have moved up sharply after the higher-than-expected US CPI and heightened geopolitical risks in the Middle East. They can target 80-82 on Brent and 76-78 on WTI in the near term. Gold, Silver, and Copper have bounced back slightly. Gold looks ranged between 2620-2700, Silver can fall to 30 while below 31.5 and Copper remains bearish towards 4.3-4.2 in the near term. Natural Gas has risen due to cooler weather forecast in the US and it can target 2.8-2.9 for the near term.

Brent ($ 78.86) rose sharply to 79.72 after the higher-than-expected US CPI data and heightened geopolitical risks in the Middle East. It can target 80-82 on the higher side before a fall to 72-70 takes place. A broad range of 82-70 can hold for some time.

WTI ($ 75.51) has bounced back sharply to close above 75 yesterday. It can inch further up towards 76-78 in the near term. Thereafter, if the resistance at 78 holds, then a fall back to 72-70-68 can take place, giving a broad range of 78-68 for the medium term.

Gold (2653.20) has held above its immediate support (2620) and rose to 2648.90 yesterday. A broad range of 2620-2700 can hold for some time before a breakout on either side takes place.

Silver (31.41) has bounced back above 31 as expected. Interim resistance is coming near 31.5 which if holds, can lead to a fall to 30.5-30.5. Else, if it moves above 31.5 then it can target 32.0-32.5 on the upside.

Copper (4.4420) rose slightly to 4.45 but the overall view remains biased to see a fall towards 4.3-4.2 in the near term.

Natural Gas (2.69) has bounced back from a low of 2.5880 to 2.6990. It can have a corrective rise towards 2.8-2.9 in the near term before resuming its fall. While below 3, the view is likely to remain bearish with short corrective up moves.

6:00 11:30 UK Trade Bal
Expn -20.7 … Expected -19.2 … Previous -20.0

12:00 17:30 IN IIP
Expn 4.1% … Expected – … Previous 4.8%

12:00 17:30 IN CPI
Expn 3.99 … Expected – … Previous 3.65

12:30 18:00 US PPI
Expn – … Expected 0.1% … Previous0.2%

12:30 18:00 US PPI ex Food & Energy (MoM)
Expn – … Expected 0.2 … Previous 0.3

12:30 18:00 CA Labour Force
Expn – … Expected 33.1K … Previous 22.1K

DATA YESTERDAY:-
————–
1:30 07:00 CN CPI (YoY)
Expn – … Expected – … Previous 0.6

1:30 07:00 CN PPI
Expn – … Expected – … Previous -1.8

12:30 18:00 US CPI (MoM)
Expn 0.2 … Expected 0.1 … Previous 0.2

12:30 18:00 US Core CPI (MoM)
Expn 0.2% … Expected 0.2% … Previous 0.3%