The fall in Eurozone PMI led the Dollar Index to rise sharply to 108.07 and Euro to fall to the low of 1.0332 on Friday but both the Euro and the Dollar Index have reversed from those levels. While the Dollar Index holds above 106, the medium term looks bullish towards 109-110. EURINR has recovered above 88 and could be headed towards 89-89.50. Aussie and Pound have also moved up and could be headed towards 0.6550-0.66 and 1.2750 respectively. USDCNY is headed towards resistance near 7.25. We need to see whether the resistance holds and pushes the pair back towards 7.20/18 or takes it higher to 7.27. The Dollar Yen is trading within its 152-155 region but overall, the view is bullish towards 157-158 in the near term. EURJPY needs to see a sustained rise past 162 to negate a fall to 160-158 in the coming sessions. USDINR can trade below 84.50 for the next 1-2 weeks before rising higher towards 84.60.

Dollar Index (106.834) rose sharply to the high of 108.07 on Friday as the Euro fell significantly on lower PMI data release. While the index sustains above 106.50-106.00, the overall view remains bullish towards 109-110 in the near term. Watch if the index bounces from 106.50/106.

The Eurozone Purchasing Managers’ Index fell to a 10-month low of 48.1, taking it below the 50-mark that separates growth from contraction. This led EURUSD (1.0485) to test 1.0332 on the downside before recovering from there. The outlook on the Dollar Index appears to be bullish and if the anticipated rise happens, then Euro would be vulnerable to test the lower levels of 1.03-1.02 on a confirmed break below 1.04 in the coming weeks.

Despite a significant strength in the Dollar, the Dollar-Yen (153.65) remained stable. The range of 152-155 can hold for the near term, but while above 153, we are keeping our view intact to see a rise past 155 to 157-158 in the coming sessions.

EURJPY (161.16) tested 159.88 on the downside before rising back to the current levels. The cross still needs to see a sustained rise past 162, else it will be vulnerable to see a fall towards 160-158 in the coming sessions.

USDCNY (7.2429) continues to trade below the crucial resistance at 7.25, a break past which would take it towards 7.27 or higher in the near term. Failure to rise past 7.25 can lead to a corrective fall in the near term towards 7.20/18. Watch price action around 7.25/26.

Aussie (0.6532) in line with our bearish view, tested 0.6471 on the downside. While below 0.655, we retain our view of seeing a fall towards 0.65-0.64 in the near term. Only a rise past 0.66 if seen, can delay the anticipated fall and take it higher to 0.67.

Pound (1.2601) has risen from immediate support at 1.2486 and if the rise sustains, Pound could soon head towards 1.2750.

USDINR (84.45) seems to be holding below 84.50 for now. We anticipate that the pair can trade below 84.50 for the next 1-2 weeks before eventually moving higher towards 84.60 by mid of Dec-24. Our target might be achieved sooner only if RBI allows Rupee to depreciate rapidly.

EURINR (88.4832) slipped below the support near 88 to the low of 87.3341 but has recovered from there. Above 88, it can rise towards 89-89.50 in the upcoming sessions.

The US Treasury yields are struggling to get a strong follow-through rise and break the immediate resistance. That keeps alive the chances of seeing a fall back in the short-term. The German yields have come down below their support. This is contrary to our expectation. A further fall from here will negate our bullish view and can drag the yields lower. The 10Yr GoI is inching up. The bullish view is intact and the yield has room to rise more.

The US 10Yr (4.35%) and 30Yr (4.54%) yields are struggling to breach 4.5% and 4.6% respectively. That keeps alive the chances of seeing a fall back to 4.2% (10Yr) and 4.4% (30Yr) in the short-term. A sustained break above 4.5% (10Yr) and 4.6% (30Yr) is needed to see the rise to 4.8% (10Yr) and 4.9% (30Yr).

The German 10Yr (2.24%) and the 30Yr (2.49%) yields have dipped below their support at 2.3% (10Yr) and 2.5% (30Yr). A further fall from can negate our bullish view of seeing 2.6% (10Yr) and 2.8% (30Yr) on the upside. In turn that will drag the yields down to 2% (10Yr) and 2.2% (30Yr). We will have to wait and watch.

The 10Yr GoI (6.8712%) has come-off from the high of 6.8886%. Bias remains bullish to test 6.9% now and 7% eventually in the coming weeks. Support will be around 6.83%.

The Dow Jones has surged above 44000, invalidating our previous bearish outlook. While above 44000, it could pave the way for further gains towards 44500–45000. However, while below 45000, our broader view is bearish towards 42000/41000. Meanwhile, the DAX has climbed past 19300, with a decisive break above 19600 required to target 20000. Nifty rose sharply above 23900 on Friday. A sustained move above 24100 would open the door for a further rise to 24500/24700. Conversely, failure to breach 24100 could pull the index lower to test support in the 23500-23000. The Nikkei opened higher, briefly reaching 39053.64 before easing slightly. As long as it stays above 38500, the index remains poised to advance beyond 39000, targeting 39500–40000. Shanghai is holding above the crucial level of 3250 which needs to sustain for a rally toward 3350–3400 and beyond. A breakdown below this level, however, could lead the index to extend the downside towards support of 3150.

The Dow (44296.51, +0.97%) has risen above 44000 contrary to our expectation. 44500-45000 can be tested but a rise beyond that is unlikely. We retain our view of seeing a fall to 42000-41000. The strategy will be to sell the rallies and not to buy the dips.

DAX (19322.59, +0.92%) has risen well and keeps our bullish view. A break above 19600 will clear the way for the rise to 20000.

Nifty (23907.25, 2.39%) has risen well above 23800. We had expected a corrective bounce to 23800. Resistance is around 24100. If that is broken, then a rise to 24500-24700 is possible. GIFT Nifty is up over 1% and it suggests a wide gap-up open, possibly above 24100. Need to see if that will sustain through the day.

Nikkei (38868.63, 1.53%) within a broad range of 38000–40000. A sustained trade above 38500 increases the likelihood of a break above 39000, paving the way for a move toward 39500–40000.

Shanghai (3278.1774, +0.34%) is currently holding above the critical support level of 3250. As long as this support remains intact, the index could rally towards 3350–3400. However, a failure to sustain above 3250 may result in a decline toward 3150.

Crude prices have recovered due to the rising concerns about geopolitical risks from Iran and Russia. A further rise towards 77 (Brent) and 74 (WTI) can be seen in the near term. Gold has rallied and can target 2750-2800 in the upcoming sessions. Silver and Copper hold above their respective support levels and can move up towards 32 and 4.2-4.3. Natural Gas fell to 3.2 on Friday but bias is bullish towards 3.6-3.8 while above 3.

Brent ($ 75.11) has inched up towards 75 due to the escalation of geopolitical tensions as Russia launched a new hypersonic missile into the city of Dnipro on Thursday. It can move further towards 76-77 in upcoming sessions.

WTI ($ 71.22) closed near its immediate resistance at 71.2 on Friday. It can break above this and rise further towards 73-74 in the near term. Failure to rise could lead to a corrective dip to 70-69.

Gold ($ 2703.20) closed higher above 2700 on Friday. A further rally towards 2750-2800 can be seen soon.

Silver (31.14) has recovered slightly from a low of 30.8. Immediate support is at 30.5 which if held could lead to a further rise towards 32 in the near term.

Copper (4.1270) tested immediate support at 4.08 on Friday. While the support holds a rise towards 4.2-4.3 looks likely in the near term.

Natural Gas (3.5320) plunged to a low of 3.24 due to the shift in US weather forecasts on Friday to warmer from below-normal. But it has opened higher at 3.47 today. While above 3.3-3.2 it can rise further towards 3.6-3.8 in the upcoming weeks.

9:00 14:30 GER IFO Business Climate
… Exp 86.7 … Expected 86.0 … Previous 86.5

9:00 14:30 GER IFO Business Situations
… Exp 84.3 … Expected 85.5 … Previous 85.7

9:00 14:30 GER IFO Business Expectations
… Exp 86.6 … Expected 87.3 … Previous 87.3

DATA FRIDAY:-
—————
23:05 04:35 UK Cons Conf
… Exp -22 … Expected -22 … Previous -21 …Actual -18

23:30 05:00 JP CPI
… Exp 2.1 … Expected 2.2 … Previous 2.5 …Actual 2.2