The Dollar Index tested 104.50 before coming down. If the fall persists, a test to 103-102.50 is likely to happen. while the Euro, seems to be holding well above the support around 1.0770 and if sustained can head towards 1.0850-1.0900 in the near term. USDJPY and EURJPY exceeded our targets of 152 and 164 respectively but have immediate resistance just above current levels. While the resistance holds, both the pairs are likely to fall back. Aussie and Pound are likely to remain ranged within 0.66-0.68 and 1.2900-1.3150 region respectively. USDCNY has been coming off and if the fall continues can get extended to 7.10 or even lower in the coming sessions. USDINR is likely to remain ranged within 83.98-84.12 region. EURINR below 91 and looks bearish to 90 in the near term. Watch out for US New Home Sales data release scheduled today.

Dollar Index (104.369) tested 104.57 as expected before cooling down a bit. Going ahead, the Index is likely to fall back towards 103-102.50 in the near term. Only a rise past 104.50 if seen, can take it higher to test 105; thereby delaying the fall. Watch out for US New Home sales data release today.

EURUSD (1.0787) observed a low of 1.0761 before recovering from there. The pair currently seems to be holding well above the support around 1.0765/70 region. While it holds, a bounce back towards 1.0850-1.0900 could be seen in the coming sessions.

Dollar-Yen (152.52) and EURJPY (164.52) saw a significant rise yesterday as the polls indicate that the ruling Liberal Democratic Party could lose its majority with coalition partner Komeito at the weekend’s general election. Immediate resistance can be spotted just above current levels in USDJPY which if holds can push the pair back towards 148-146. EURJPY similarly has interim resistance coming around 165 which if holds, can bring it back to 161.

USDCNY (7.1153) could not sustain its rise above 7.13 and started coming off. If the fall extends further, a test to 7.10 or even lower could be seen in the near term.

Aussie (0.6646) continues to remain volatile within its broad range of 0.66-0.68 which can persist for a while.

Pound (1.2924) has slipped below our mentioned range of 1.3150-1.2950. Immediate support can be spotted around 1.29. While it holds, it is likely to bounce back higher and a revised range of 1.2900-1.3150 can hold for some time.

USDINR (84.0550) can see a gradual rise towards crucial resistance at 84.10-84.12. We continue to look at the 83.98-84.12 range to hold for the very near term.

EURINR (90.6950) has tested our initial target of 90.50. While below 91, the overall view remains bearish to 90 on the downside. The Cross needs to rise past 91 again to move higher towards 91.50-92.

The US Treasury and the German yields sustain higher. While the Treasury yields sustain above their immediate support, an extended rise can be seen in the coming days. The German yields are also bullish to rise more from here. The Indian 10Yr GoI is coming down within its broad range. The sideways range is intact. We remain bullish to see an upside breakout of this range going forward.

The US 10Yr (4.23%) and the 30Yr (4.51%) yields sustain higher. While above 4.2% (10Yr) and 4.5% (30Yr), an extended rise to 4.4% (10Yr) and 4.6% (30Yr) is possible. Thereafter a reversal to 4% (10Yr) and 4.3% (30Yr) can be seen.

The German 10Yr (2.31%) and the 30Yr (2.62%) yields remain higher. The bullish view is intact to see a rise to 2.4% (10Yr) and 2.7% (30Yr). The price action thereafter will need a watch.

The 10Yr GoI (6.8197%) has dipped further. A test of 6.8% looks likely. The broad 6.7%-6.85% range is intact. We expect an upside breakout of this range and a rise to 7% eventually over the medium-term.

The Dow Jones failed to sustain its position above 42700, dropping to an intra-day low of 42293 before recovering above 42500. While the index gets support within the 42300–41800 region, a recovery towards 43000/44000 is possible eventually. Similarly, as anticipated, the DAX is approaching the 19200 level. It could bounce back from the support region of 19200-19000 soon. The Nifty continues to face selling pressure, reversing from an intra-day high of 24604 and closing above 24400. Nifty needs to sustain above the support of 24200. Failure to do so could extend the losses towards 24000. As expected, the Nikkei reached a low of 37712 before rebounding above 38000. Meanwhile, the Shanghai failed to hold above 3,300 and has fallen back into the 3300–3200 range.

The Dow (42514.95, -0.96%) has declined sharply. Failure to sustain above 42500 can take it down to 42000-41800. In that case, the rise to 44000 that we have been mentioning will get delayed.

DAX (19377.62, -0.23%) is coming down towards 19200 as expected. We repeat that 19200-19000 is a good support zone. While above this support, the trend is up and DAX can rise back to target 19800-20000.

Nifty (24435.50, -0.15%) can test 24200. A bounce from there can take the Nifty up to 24500-24600. Else the fall can extend to 24000. Price action around 24200 will need a close watch.

Nikkei (38154.20, +0.13%) dropped to a low of 37712 before climbing back above 38000. While it holds the previously mentioned support of 38000-37500, we can expect an up move towards 38500. A rise past 38500 could extend the gains higher to 40000.

Shanghai (3288.3406, -0.41%) has returned to its sideways range of 3300–3200. Within the range of 3300–3200, a fall towards 3250 can be expected. Alternatively, it could re-attempt to rise past 3300.

Crude prices dip from their respective resistance levels after the weekly stock inventory rose according to the EIA report. While below their respective resistance levels, Brent and WTI can fall to 73 and 68 respectively in the near term. Gold and Silver have fallen back after testing their immediate resistance levels. While the immediate support holds, a bounce back towards 2780-2800 and 35-36 respectively is expected in the coming weeks. Copper remains ranged between 4.5-4.30/25. Natural Gas rose sharply and can target 2.5-2.6 on the higher side.

Brent ($ 75.71) fell to 74.42 yesterday in line with our expectation, as crude inventories rose by 5.5 million barrels (EIA report), bringing a total inventory count to 426 million barrels. While 76 holds, it can test 74-73 on the downside before rising back to 78-80 on the higher side.

WTI ($ 71.57) dipped to 70.13 yesterday as expected. While below 72 it can fall towards 69-68 in the near term before a rise to 74-76 takes place.

Gold $ 2735.80) has held below its immediate resistance as it has fallen to 2722.60 in line with our expectation of seeing a fall to 2720-2700. While above 2720-2700 it can rally back to 2780-2800 in the near term.

Silver (34) fell to 33.81 as expected. Immediate support can be seen near 34.0-33.8, while above this it can rally back higher towards 35-36.

Copper (4.3570) dipped slightly to 4.31 yesterday. It can trade within the earlier mentioned range of 4.5-4.30/25 for some time.

Natural Gas (2.40) rose sharply to 2.44 as expected but it came back sharply from there to close at 2.34 yesterday. While above 2.2 it can extend the rise further towards 2.5-2.6 in the near term.

14:00 19:30 US New Home Sales
… Exp 727K … Expected 717K … Previous 716K

DATA ON YESTERDAY:
—————
14:00 19:30 US Existing Home Sales
Exp 3778 …Expected 3880 …Previous 3880 … Actual 3840

13:45 19:15 BOC Meeting
Exp – …Expected 3.8% …Previous 4.25%