The Dollar Index has support around 106 above which it is likely to move up towards 107 or even higher. The fall in Euro to 1.04 cannot be fully ruled out until a further rise past current levels is seen. The Aussie and Pound have supports around 0.6450-0.64 and 1.25 respectively which can be tested soon in the near term. USDCNY is holding well below the resistance 7.25/26 from where a rejection can be expected. The Dollar Yen is back within the 152-155 range, EURJPY tested 165 as expected on Friday before coming down. Both the pairs have scope to rise higher while the respective near-term supports hold. EURINR is bearish towards 88.50-88.00 while USDINR could remain flat near 84.40 for a few more sessions and attempt to move up towards 84.50 or higher in the next couple of weeks.

Dollar Index (106.659) tested 107.064 last week before coming down. Near-term resistance turned support is coming around 106, a break below which will be needed to make the outlook bearish again. Until then, it can continue to move up towards 107 or even higher.

EURUSD (1.0539) has witnessed a low of 1.0496 so far before recovering a bit from there. An extended fall to 1.04 cannot be fully ruled out until a further rise past current levels is seen.

Dollar-Yen (154.88) came down significantly from the high of 156.75 on Friday on the possible intervention by the BOJ. Currently, it is back within its range of 152-155 but while above 153/54 it has enough room to bounce back past 155 again. Targets on the upside could be 157-158.

EURJPY (163.23) tested 165 on the upside in line with our view, before coming down. Immediate support is around 162, above which the cross is likely to bounce back again towards 165 or even higher in the coming sessions.

USDCNY (7.2335) seems to be holding well below the resistance near 7.25. Until a decisive break past 7.25 is seen, the preferred view is to see a corrective fall in the near term. Watch price action around 7.25/26.

Aussie (0.6472) tested our initial target near 0.6450 before rising a bit from there. Immediate support around current levels and lower at 0.64 suggests a limited downside for the pair and that it can rise back again in the coming sessions.

Pound (1.2634) has been coming off for a while and even tested 1.2599 on Friday. Overall, the outlook continues to remain bearish towards 1.25.

USDINR (84.40) could remain flat near 84.40 for a few more sessions and attempt to move up towards 84.50 or higher in the next couple of weeks. Any downside, if seen could be limited to support near 84.30/27.

EURINR (89.0067) has enough room on the downside to test the support near 88.50-88, before attempting to rise back again in the coming sessions.

The fall in the US Treasury yields that we have been expecting is not happening. Need to watch for a day or two. A rise above the immediate resistance from here will negate the fall and in turn will take yields higher. The German yields are holding well above their support. Outlook is bullish and the yields can rise from here. The 10Yr GoI is coming up towards the upper end of the current range. Bias is positive to break the range on the upside and rise if not immediately but eventually.

The US 10Yr (4.43%) and 30Yr (4.61%) yields continue to sustain higher. The 10Yr has to fall below 4.4% for the expected fall to 4.2%-4.4% to happen. A break above 4.5% will negate this view and take the yield up to 4.8%. The 30Yr on the other hand can rise to 4.9% while it sustains above 4.4%. It has to fall below 4.4% to see 4%-4.2% on the downside.

The German 10Yr (2.35%) and the 30Yr (2.57%) yields are holding well above their supports. While above 2.3% (10Yr) and 2.5% (30Yr), the bullish view is intact to see a rise to 2.6% (10Yr) and 2.8% (30Yr).

The 10Yr GoI (6.8645%) is coming up towards 6.88% as expected. Failure to break 6.88% can keep the 6.8%-6.88% range intact for some more time and take the yield down within it. The bias is positive to breach 6.88% eventually and rise to 6.9% and 7%.

Global equity indices face selling pressure. The Dow Jones has declined below 43500, reinforcing our bearish outlook with potential downside targets at 42000-41000. The DAX remains within the 19000-19600 range and is expected to consolidate within this band for some time. However, failure to see a strong rise could make it vulnerable to break below 19000 and head towards 18800/500. Nifty remained flat but while above immediate support at 23400, a bounce to 23800 is a possibility before resuming the fall to 23000. Nikkei fell below 38500 to a low of 38150 before seeing a recovery to the current level. Looking forward, while below 38500, it could extend the fall towards 38000-37700. Shanghai broke below 3400, contrary to our view of seeing a rise to 3500 and negating the rise towards 3500. Now it could be headed towards 3300-3250.

The Dow (43444.99, -0.70%) is coming down from the resistance at 44500 as expected. A fall to 43000 is possible now. From a medium-term perspective, the current fall can eventually extend up to 42000-41000 in the coming weeks, with intermediate bounces.

DAX (19210.81, -0.27%) is managing to sustain above 19000. But lack of strength to rise strongly keeps it vulnerable to breaking below 19000 and dipping to 18800-18500. A strong rise above 19600 is needed to strengthen the bullish case for 20000.

Nifty (23532.70, -0.11%) has support near 23400. A corrective bounce to 23800 is a possibility before the resumes towards 23000.

Nikkei (38378.62, -0.70%) while below 38500, a test of the support of 38000-37700 could be seen.

Shanghai (3425.4052, -0.40%) broke below 3400 and plunged below 3350. While below 3350, a test of 3300-3250 looks possible before attempting an upmove.

Crude prices have fallen to their immediate support levels. While the supports hold, a bounce back towards 74 (Brent) and 69 (WTI) can take place in the near term. Gold, Silver and Copper have seen some recovery. Gold needs to break above 2600 to see a rise towards 2650-2700, else can fall back to 2550-2500 while Silver and Copper are holding above their immediate support levels and can bounce back towards 31.0-31.5 and 4.2-4.3 respectively in the upcoming sessions. Natural Gas looks ranged between 3.0-2.6 while below 3.

Brent ($ 71.25) tested a low of 70.83 on Friday. Immediate support is seen near 70.5/70.0 above which Brent can bounce back towards 74 in the near term. A range of 70-75/76 can hold for some time.

WTI ($ 67.01) has fallen to its immediate support near 67 as expected. While the support holds, a bounce back to 69-71 can take place in the near term, giving a range of 67-71/72 for some time.

Gold ($ 2591.40) is recovering slightly after closing lower at 2570.10 on Friday. Only a sustained break above 2600 can take it higher towards 2650-2700 else while below 2600, the near term looks bearish towards 2550-2500.

Silver (30.65) is holding above its immediate support near 29.50 above which, it can gradually rise towards 31.0-31.5 in the near term. Failure to rise above 31.5 could lead to a sideways range of 31.5-29.5 for some time.

Copper (4.0810) is hovering near its interim support near 4 and while it holds a bounce back towards 4.2-4.3 looks more likely. Only a sustained break below 4.0, if seen, can be bearish for Copper towards 3.8-3.6 but that looks less likely for now.

Natural Gas (2.9320) fell to a low of 2.6880 on Friday as European gas prices rallied sharply. It has opened higher with a gap up at. 2.92 today. Immediate resistance is at 3 below which it can fall back to 2.8-2.6 and range between 3.0-2.6 for the upcoming weeks.

10:00 15:30 EU Trade Bal
… Exp – …Expected 7.9 …Previous 11.0

14:00 02:30 US TICS (Net foreign purch of long-term Sec)
… Exp – …Expected 114.3$ Bln …Previous 111.4$ Bln

DATA FRIDAY:-
—————
23:50 05:20 JP GDP
… Exp – …Expected 0.2% …Previous 0.7% …Actual 0.2%

2:00 07:30 CN IIP (YoY)
… Exp – …Expected 5.5 …Previous 5.4 …Actual 5.3

2:00 07:30 CN Retail Sales
… Exp – …Expected 3.8 …Previous 3.2 …Actual 4.8

7:00 12:30 UK Trade Bal
… Exp -14.2 …Expected -16.5 …Previous -15.2 …Actual -16.3

7:00 12:30 UK GDP
… Exp – …Expected 0.5% …Previous 0.5% …Actual 0.1%

13:30 19:00 US Retail Sales (MoM)
… Exp 0.2% …Expected 0.3% …Previous 0.8% …Actual 0.4%

14:15 19:45 US Industrial Production
… Exp -0.4% …Expected -0.2% …Previous -0.5% …Actual -0.2%

14:15 19:45 US Capacity Utilization
… Exp 77.1% …Expected 77.4% …Previous 77.4% …Actual 77.1%