The Dollar Index looks stable above the support of 106.75 for now but the upside is likely to be capped at 108. A break below 106.75 can strike in further bearishness. Euro needs to see a break past 1.0530/50 to head towards 1.0600 in the coming sessions. EURINR needs to see a decisive break on either side of the range of 88-90 for further directional clarity. Aussie is coming off as expected and can soon test 0.63 before bottoming out. The Pound is trading higher within its range of 1.25-1.28. USDCNY continues to rise further and remains bullish towards 7.30-7.35 while above 7.28/25. USDJPY and EURJPY seem to be holding well below 155 and 163 and the view remains bearish towards 152 and 160 or lower respectively in the near term. USDINR tested 84.90 yesterday. If it fails to see an immediate dip in the onshore markets below 84.90, then it could be vulnerable to head towards 84.95-85.00 soon. Watch out for US Housing starts, US Current Account balance and the FOMC meeting scheduled today.

Dollar Index (106.917) rose slightly above 107 on the better-than-expected retail sales data release at 09% (0.6%). Currently, it continues to trade above the support of around 106.75. FOMC is scheduled today with uncertainty on whether FED will deliver rate cuts or not. In either case, the Upside could be capped at 108; a break below 106.75 can drag it further to 106.00-105.50 in the coming sessions.

EURUSD (1.0500) had slipped below 1.05 to the low of 1.0478 but recovered well from there. A rise above 1.0530-1.0550 will be needed to head towards 1.0600 in the near term. For the medium term, only a strong break past 1.06 can make the outlook bullish. The downside for now can be limited to 1.0450-1.0400.

EURINR (89.3196) continues to trade higher within its range of 88-90. Immediate resistance is coming around 89.50-89.70 region which if held, can push the pair back towards 89 or lower. A decisive break on either side will be needed for further directional clarity.

Dollar-Yen (153.69) and EURJPY (161.40) seem to be holding well below the resistance around 155 and 163 region respectively. For now, the preferred view is to see a fall back towards 152 and 160 or lower in the near term, while 155 and 163 hold respectively. Overall, the range of 155-152/150 can hold for some time in USDJPY.

USDCNY (7.2846) is slowly inching up higher. While the immediate support at 7.28 and lower at 7.25 holds, a rise to 7.30/35 looks likely in the near term.

Aussie (0.6325) is nearing our mentioned target of 0.63 which can be tested soon. Thereafter, our preferred view is to see the pair bouncing back higher in the coming sessions. A strong break past 0.6450 can pave the way for bullishness in the medium term. Only a decisive break below 0.63 if seen (less likely), can lead to us revising our view accordingly.

Pound (1.2702) continues to trade higher within its range of 1.25-1.28. FOMC scheduled today and BOE tomorrow might give better clarity on where the pair is headed. For now, its range of 1.25-1.28 can persist in the near term.

USDINR (84.8780) rose to 84.91/92 yesterday before closing slightly lower. There could be some scope for a dip towards 84.85 (in case of a FED rate cut) but chances of a rise towards 84.95/85.00 look higher in the near term. The downside could be limited to 84.80 or to a maximum of 84.70 in the near term. Bias is bullish towards 85.00 with some corrective dips possible.

The German and the US Treasury yields continue to remain stable. Market is waiting for the US Federal Reserve meeting outcome tonight. A 25-bps rate cut is already factored in the market. Important to watch tonight will be the economic forecast that will have the future rate cut path. On the charts, both the US Treasury and the German yields have room to rise more from current levels. The 10Yr GoI is moving up in line with our expectation. A reversal is still possible after some more rise from here.

The US 10Yr (4.39%) and 30Yr (4.58%) yields continue to remain stable. A rise to 4.45%-4.5% (10Yr) and 4.65%-4.7% (30Yr) can be seen from here after which the price action will need a close watch.

The German 10Yr (2.23%) and the 30Yr (2.45%) yields remain higher but stable. Bullish view is intact to see a rise to 2.4%-2.45% (10Yr) and 2.6% (30Yr).

The 10Yr GoI (6.7971%) has risen well and can head up towards 6.8%-6.83% in line with our expectation. Thereafter a fall back to 6.7%-6.65% is still a possibility.

The Dow Jones continues its downward trend without our expected corrective rise to 40700 thus, reinforcing our bearish outlook for a move toward 43,000. DAX declined intraday but managed to close above 20,200, maintaining a bullish bias as long as it holds above this level. Dax can now target 20,700–21,000 while 20200 holds well. Nifty tested support near 24,300 and rebounded slightly. With additional moving average support also near this level, a sustained hold above 24,300 would keep the bullish view intact, targeting higher levels. Nikkei dropped to an intraday low of 39,123.32 before recovering. However, while trading below 39,500, the index remains vulnerable to further declines toward 39,000–38,000. Shanghai fell to 3,357 intraday before recovering to the current level. The index could retest resistance near 3,400, but a sustained break above this level is required to negate a bearish outlook targeting 3,350–3,300.

The Dow (43449.90, -0.61%) has declined below 43700. The fall to 43000 is happening without the corrective bounce from 43700. We can now expect a corrective bounce from around 43000.

DAX (20246.37, -0.33%) continues to dip. A fall to 20000-19900 looks likely now. Daily chart indicates that the expected turn-around seems to have happened well ahead of 20700-21000.

Nifty (24336, -1.35%) fell sharply below 24500. The rise to 25000 that we have been expecting is not happening immediately but has not been ruled out completely yet. 24,300 and 24200-24150 are crucial supports to watch. While above 24150, the rise to 25000 will still remain a possibility.

Nikkei (39218.01, -0.21%) trades lower but remains above 39,200. As long as the index stays below 39,500, the bias remains bearish for a decline toward 39,000–38,000. Conversely, a breakout above 39,500 could shift momentum, opening the door for a rise toward 40,000–41,000.

Shanghai (3384.8439, +0.69%) recovered from a low of 3,357 to current levels. Further upside toward 3,400 is possible in the near term. However, a sustained break above 3,400 is essential to avoid further downside. A failure to breach this resistance could resume a bearish trend toward 3,350–3,300.

Concerns about weak Chinese energy demand are weighing on crude prices. A broad range of $ 76-71 (Brent) and $ 72-67 (WTI) can hold for some time. Gold and Copper remain bearish towards 2600 and 4.05 respectively for the near term. Silver is holding above its immediate support and can bounce back towards 31.5-32.0. Natural Gas can extend its bullishness further towards 3.6.

Brent ($ 73.30) has dipped slightly due to the concerns of weaker Chinese energy demand. A broad range of $ 76-71 can hold for the upcoming weeks.

WTI ($ 69.72) fell to a low of $ 68.81 yesterday before closing higher at $ 69.65. A broad range of $ 72-67 is expected to hold for some time.

Gold ($ 2666.90) has dipped slightly and can continue to be bearish towards 2600 in the near term. Thereafter while 2600 holds a bounce back towards 2700-2750 can take place.

Silver (31.01) is hovering near its immediate support. While the support holds, a rise towards 31.5-32.0 looks more likely for the near term. Alternatively, a sustained break on the downside can initiate a further fall towards 30.0-29.5. Watch price action near current levels.

Copper (4.1490) fell to 4.13 in line with our expectations. It can decline further towards its immediate support near 4.10-4.05 in the upcoming sessions.

Natural Gas (3.3840) has bounced back from a low of 3.09 and surged to 3.39 yesterday after the European Union said it has no interest in Russian gas, which could tighten European nat-gas supplies further and prompt increased demand for US nat-gas. The price can move further up towards 3.6 in the near term, giving a broad range of 3.6-3.2/3.0 for some time.

7:00 12:30 UK CPI Y/Y
… Exp 2.3% … Expected 2.6% … Previous 2.3%

10:00 15:30 EU CPI (YoY)
… Exp 2.3% … Expected – … Previous 2.3%

13:30 19:00 US Housing Starts
… Exp 1342K … Expected 1350K … Previous 1311K

13:30 19:00 US Current Account Balance
… Exp – … Expected -286.0 … Previous -266.8

18:00 23:30 US FOMC Meeting
… Exp <4.50% ... Expected <4.50% ... Previous <4.75% DATA ON YESTERDAY:-
—————
7:00 12:30 UK Unemp
… Exp 4.0% … Expected 4.3% … Previous 4.3% …Actual 4.3%

9:00 14:30 GER IFO Business Climate
… Exp 86.1 … Expected 85.6 … Previous 85.6 …Actual 84.7

9:00 14:30 GER IFO Business Situations
… Exp 83.4 … Expected 84.0 … Previous 84.3 …Actual 85.1

9:00 14:30 GER IFO Business Expectations
… Exp 85.6 … Expected 87.5 … Previous 87.0 …Actual 84.4

10:00 15:30 EU Trade Bal
… Exp – … Expected 11.9 … Previous 11.6 …Actual 6.8

13:30 19:00 US Retail Sales (MoM)
… Exp 0.2% … Expected 0.6% … Previous 0.4% …Actual 0.9%

13:30 19:00 CA Inflation Y/Y
… Exp – … Expected 2.1% … Previous 2.0% …Actual 2.0%

14:15 19:45 US Industrial Production
… Exp 0.0% … Expected 0.2% … Previous -0.2% …Actual – 0.1%

14:15 19:45 US Capacity Utilization
… Exp 77.1% … Expected 77.3% … Previous 77.0% …Actual 76.8%