ECB went ahead with the 25 bps rate cuts, thereby bringing the refinancing rate to 3.15%. As a result, Dollar Index rose past 107 which if sustained can test 108 as well before getting topped out. Euro continues to trade below 1.05 but the downside is expected to be limited to 1.0450-1.0400. EURINR is coming off within its range of 90-88 which can hold for now. Aussie has again slipped below 0.64 but a fall below 0.6350-0.63 is not anticipated. It can bounce back higher upon testing 0.6350-0.6300 on the downside. The Pound can also fall within its earlier range of 1.2750-1.2450. USDCNY continues to rise further and while above 7.25, the view remains bullish towards 7.30-735. USDJPY can rise higher towards 154-155 in the coming sessions while above 150. EURJPY remains bullish towards 162-163, while above 156. USDINR needs to see a break below 84.80 to test 84.75/70 on the downside. Else, it can be vulnerable to see a break above 84.88 and become bullish towards 84.95-85.00.

Dollar Index (107.075) witnessed a significant rise yesterday after the ECB went ahead with 25 bps rate cuts, bringing the refinancing rate down to 3.15%. Our initial target of 107 has been met and now if sustained above current levels, it can extend further to 108 before possibly topping out for the near term. At the same time, failure to sustain the ongoing rise can bring it back to 106 or lower.

EURUSD (1.0464) is coming off as expected and if the fall continues further, it can get extended to 1.0450-1.0400 max before it attempts to rise back higher. A fall below 1.04 is not anticipated for now as our overall medium-term view is bullish above 1.04.

EURINR (88.8191) has been falling since the last few sessions after getting topped out at 89.87. It has a scope to extend the fall towards 88.50-88.00. Overall, its range of 90-88 is likely to persist for a while, until a decisive break is seen on either side.

Dollar-Yen (152.87) is rising higher as anticipated and if sustained, can soon test 154-155 in the coming sessions. Overall, its earlier range of 150-155 can hold for some time.

EURJPY (159.98) is struggling to hold its rise past 160, a decisive rise past which can take it higher to 162-163. Overall, the view is bullish while it trades above the support at 156-157.

USDCNY (7.2761) continues to rise further due to China’s statement of them allowing the Yuan to weaken to prepare for Trump tariffs. While the rise is sustained above 7.25 the targets on the upside are 7.30/35. Overall, the view remains bullish above 7.25.

Aussie (0.6356) has again slipped below 0.64 on Dollar strength. Even if the fall extends, the downside is anticipated to be limited to 0.63 for now. Thereafter, it can attempt to bounce back higher but a strong break past 0.6450 will be needed to initiate bullishness for the pair in the near term.

Pound (1.2663) has moved significantly below 1.27. Only a strong rise past 1.28 if seen, can make the outlook bullish on Pound. Else, the outlook appears bearish towards 1.26-1.25 in the coming sessions. The earlier range of 1.2750/70-1.2450 can hold for a while.

USDINR (84.8430) witnessed a high of 84.88 before closing at 84.8625 yesterday. Only a break below 84.80 can bring it lower to 84.75/70. Else, it can be vulnerable to see a break above 84.88 and become bullish towards 84.95-85.00.

The US Treasury yields are getting a good follow-through rise following the rise seen after the inflation data release on Wednesday. That leaves the short-term outlook bullish, and the yields can rise more in the coming days. The German yields have risen sharply. That keeps intact our bullish view. The ECB made another 25-bps rate cut in its meeting yesterday, in line with market expectation. More rise can be seen going forward. The 10Yr GoI is moving up as expected. Some more rise is possible before it turns down again.

The US 10Yr (4.32%) and 30Yr (4.54%) has got a strong follow-through rise above 4.25% (10Yr) and 4.45% (30Yr). They can now rise to 4.4%-4.5% (10Yr) and 4.65%-4.7% (30Yr). The fall to 4% (10Yr) and 4.2% (30Yr) has been negated.

The German 10Yr (2.20%) and the 30Yr (2.44%) yields have risen sharply. The rise to 2.3% (10Yr) and 2.5% (30Yr) is happening much faster than expected. Support at 2% (10Yr) and 2.2% (30Yr) has held very well.

The 10Yr GoI (6.7819%) is moving up towards 6.8%-6.83% in line with our expectation. We can expect the yields to turn down after this rise towards 6.7%-6.65%.

The Dow Jones has declined below 44000, keeping our bearish view towards 43000 and then to 42000/41000 intact. DAX remained stable below 20500. A break past 20500 is required to pave the way towards 20500-20700 which can be followed by a corrective fall to 20000 later. Nifty has declined below 24600. While it holds above 24500-24400, and upon breaking past 24700, a rise towards 25000 looks possible. Nikkei faced a rejection from 40000 and has come down below 39500. A break below 39000 would take the index down to 38000. Watch price action near 3400 on Shanghai as a bounce or break of this level would decide the next course of movement.

The Dow (43914.12, -0.53%) has declined below 44000 and can head down towards 43000 first and then to 42000-41000 eventually. Intermediate support is at 43700 which might hold on its first test and produce a short-lived bounce.

DAX (20426.27, +0.13%) is heading up towards 20500-20700 as expected. The upside can extend up to 21000. But be cautious as the DAX enters into the 20500-21000 region. A corrective fall to 20000 and lower is possible after this rise.

Nifty (24548.70, -0.38%) has closed lower below 24600. But immediate support is at 24500 which has to be broken to see more fall to 24400 and not more than that. Broadly, the bias is positive to breach 24700 decisively and rise to 25000 in the coming days.

Nikkei (39360.38, -1.23%) failed to breach 40000 and has come down. A break below 39000 would take the index lower towards 38000. A rise past 39500, if seen again would lead to a retest of 40000.

Shanghai (3412.28, -1.40%) has come down but is trading above 3400. Price action around 3400 would be important to watch for directional clarity. If it holds above this level, a further rise toward 3500 looks probable. However, failure to hold above 3400 will extend the downside to the support at 3350-3300.

Curde prices have dipped slightly but the outlook remains bullish for the prices towards 75-76 (Brent) and 72-73 (WTI). Gold and Silver have fallen but they can bounce back towards 2770-2800 and 32.5-33.0 respectively while above 2700 and 31. Copper remains mixed for the upcoming sessions. Natural Gas can test 3.6 in the near term.

Brent ($ 73.41) has dipped slightly. As long as it holds above 72, it can rise towards 75-76 in the upcoming sessions.

WTI ($ 70.01) is holding above 69. A rise towards 72-73 looks likely for the near term.

Gold ($ 2713.60) has sustained a fall after testing a high of 2761. While above 2700 we retain our view of seeing a rise to 2770-2800 in the near term.

Silver (31.55) has plunged to a low of 31.50 yesterday as anticipated, due to stronger Dollar. The 21-Day moving average support is seen near current level and trend support seen further down at 31. Hence a break below 31.5 if seen, can be short lived upto 31. Thereafter, it can bounce back towards 32.5-33.0 while above 31.

Copper (4.23) has fallen to 4.2175 yesterday in line with our expectations. A sustained break below 4.2 is needed to see lower levels of 4.1, else it can move higher above 4.3 and target 4.4-4.5.

Natural Gas (3.4540) tested a high of 3.5590 yesterday, in line with our bullish outlook of 3.5-3.6. It can test 3.6 in the next few sessions. This level has been acting as a threshold for almost a couple of years. A sustained break above this level would open higher levels of 4-5 in the long term.

23:50 05:20 JP Tankan Large Manufacturers Index
… Exp – … Expected 13 … Previous 13

0:01 05:31 UK Cons Conf
… Exp -21 … Expected -18 … Previous -18

7:00 12:30 UK Trade Bal
… Exp -16.1 … Expected -16.1 … Previous -16.3

10:00 15:30 EU Ind Prodn (MoM)
… Exp -1.6 … Expected -0.1 … Previous -2.0

DATA ON YESTERDAY:-
—————
0:30 06:00 Australia Labour Force
… Exp – … Expected 26.0K … Previous 12.1K …Actual 35.6K

8:30 14:00 SNB Mtg
… Exp – … Expected 0.75% … Previous 1.00% …Actual 0.50%

12:00 17:30 IN IIP
… Exp 2.8% … Expected 3.5% … Previous 3.1% …Actual 3.5%

12:00 17:30 IN CPI
… Exp 5.52 … Expected 5.53 … Previous 6.21 …Actual 5.48

13:15 18:45 ECB Mtg
… Exp 3.15% … Expected 3.15% … Previous 3.40% …Actual 3.15%

13:30 19:00 US PPI
… Exp 0.1% … Expected 0.3% … Previous 0.3% …Actual 0.4%

13:30 19:00 US PPI ex Food & Energy (MoM)
… Exp 0.5 … Expected 0.2 … Previous 0.3 …Actual 0.2%