The Dollar Index can test the resistance coming around 110-111 region in the near term while above 108.00-108.50. Euro could face rejection from 1.0350-1.0400 region. EURINR and USDJPY can trade sideways between 88-89/90 and 156-158 respectively for the near term. Pound and EURJPY have risen past 1.24 and 162 again. EURJPY can head towards 164-165, while Pound has limited upside to 1.25-1.26. Aussie looks stable above 0.62 but immediate upside could be capped at 0.6250-0.6300. USDCNY has finally risen past 7.30 and can now head towards 7.35 soon. USDINR can test 86 on the upside on a confirmed break past 85.80. The downside for the week is expected to be limited to 85.70/65.

Dollar Index (108.896) had declined a bit on Friday but while above 108.00-108.50, it has the scope to test the resistance coming at 110-111 in the near term before possibly getting topped out. Only a break below 108 if seen, can delay the targets.

EURUSD (1.0312) has recovered well from the low of 1.0223 but could face rejection from the 1.0350-1.0400 region. If the pair again slips below 1.03, it can trigger a fall to 1.02 or even 1.01-1.00 in the near term on a confirmed break below 1.02.

EURINR (88.4508) is holding well above the support of 88 and if sustained, can rise towards 88.50-89.00 in the coming sessions. Overall, a narrow range of 88-89 and a broad range of 88-90 can hold in the near term.

Dollar-Yen (157.73) needs to break past 158 to head towards 160 or higher in the coming sessions. Until then, a narrow range of 156-158 can hold for some time. Overall, the downside is expected to be limited to 156-155. Watch price action closely around 158.

EURJPY (162.69) has risen past 162 again. Now if the rise sustains, it can get extended towards 164-165 again in the coming sessions. Only a decisive break below 162 if seen, can make it bearish towards 160-158/56. For now, the view remains bullish above 162.

USDCNY (7.3265) has finally risen past 7.30 and can head towards 7.35 in the near term. Looking from the broader picture, it has a scope to rise towards 7.40 but a confirmed break past 7.35 will be needed for that. Overall, the view is bullish for now.

Aussie (0.6231) is attempting to rise back but the upside looks capped at 0.6250-0.6300. Any decisive break below 0.62 if seen can indicate medium-term bearishness for the pair with an initial target of 0.61-0.60. Only a sustained rise past 0.63 can negate the bearish view.

Pound (1.2439) was expected to fall towards 1.22 or even 1.20 while below 1.24. Instead, it rose from the low of 1.2363 itself. Currently, it is back above 1.24 but resistance is coming between 1.25-1.26 region, thereby suggesting limited upside for the pair. While below 1.26, fall to 1.22 cannot be ruled out.

USDINR (85.7270) can test 86 within the current week itself on a confirmed break past 85.80. Overall, the downside could be limited to 85.70/65 and gradually it can rise higher in the coming sessions.

The US Treasury yields have risen sharply. The bullish view is intact. There is room for the yields to rise more from here. The German yields have entered their crucial resistance zone. A strong breakout is needed in the coming days to see an extended rise and avoid falling back. Wait and watch. The 10Yr GoI is coming down. While it remains below its resistance, more fall can be seen in the coming days.

The US 10Yr (4.62%) and 30Yr (4.84%) remains have risen sharply. The bullish view is intact to see stable 4.8% (10Yr) and 5% (30Yr) on the upside. Support is at 4.5%-4.45% (10Yr) and 4.7%-4.65% (30Yr).

The German 10Yr (2.42%) and the 30Yr (2.65%) yields have come into their crucial 2.4%-2.45% (10Yr) and 2.6%-2.65% (30Yr) resistance zone. A strong breakout can take them up to 2.6% (10Yr) and 2.8% (30Yr). Else they can fall back to 2.2% (10Yr) and 2.4% (30Yr). Wait and watch.

The 10Yr GoI (6.7781%, 06.79 GS 2034) is coming down inline with our expectation. It can fall to 6.7% while below 6.8%. We reiterate that a strong rise above 6.84% is needed to negate this fall and take the yield up to 6.9% and higher.

The Dow Jones has risen well above 42700 but remains bearish while trading below 43500, with downside targets of 42000-41500. DAX failed to sustain above 20000 and needs a break above 20200 to advance toward 21000. Otherwise, the index may drop to 19500. Nifty closed lower but held above 24000. As long as it sustains above 24000-23800, it retains the potential to rise toward 24500. Nikkei has declined below 39500 and could fall further within the 40000-38000 range, targeting 39000-38500. Shanghai dropped to a low of 3185 before recovering slightly. A rise above 3250 is essential to eliminate downside risks.

The Dow (42732.13, +0.80%) is managing to hold above 42000. A corrective bounce to 43000-43500 looks possible in the near-term before a fall to 42000-41500 happens.

DAX (19,906.08, -0.59%) remains stable below 20000. Resistance is at 20200 while below which the bias is negative to see a fall to 19600-19500.

Nifty (24004.75, -0.76%) has come down on Friday. But support is around 23800. While it sustains above this support, a rise to 24500 is possible in the near-term. The price action thereafter will need a close watch.

Nikkei (39394.22, -1.00%) is trading below 39500, aligning with our expectation of the index remaining within the 40000-38000 range. Within this range, it could further decline toward 39000-38500.

Shanghai (3214.4185, +0.12%) has recovered slightly from its low of 3185 and is trading above 3200. A decisive break above 3250 is necessary to move higher. While below 3250, the index could test the support of 3150.

Crude prices have rallied higher as expected due to weaker Dollar and US economic strength. Immediate resistance levels can be tested in the near term before a fall to 75-74 (Brent) and 73-72 (WTI) takes place. Gold, Silver and Copper can target 2700-2750, 30.5-31.0 and 4.10-4.15 respectively on the higher side. Natural Gas remains bullish towards 3.8-4.0 while above 3.4/3.3.

Brent ($ 76.66) has risen in line with our expectations. It can test 77-78 in the near term before a fall to 75-74 takes place.

WTI ($ 74.21) has rallied higher as expected. Immediate resistance is at 75 which if holds can lead to a fall back to 73-72. A sustained break above 75 would confirm further bullishness towards 80 but looks less likely for now.

Gold ($ 2657) holds above 2650. Above 2650 we retain our view of seeing a rise to 2700-2750 in the upcoming sessions.

Silver (30.16) remains bullish towards 30.5-31.0 for the near term.

Copper (4.0725) has bounced back to 4.08 on Friday as expected. A further rise towards 4.10-4.15 can take place in the upcoming sessions.

Natural Gas (3.5150) plunged to a low of 3.33 on Friday but has bounced back above 3.5 today. While above this, a rise towards 3.8-4.0 can take place in the near term.

5:00 10:30 IN Services PMI
… Exp 58.5 … Expected 60.8 … Previous 58.4

DATA FRIDAY:
————-
8:30 14:00 CH PMI
… Exp 48.4 … Expected 48.4 … Previous 48.5 … Actual 48.4

14:00 19:30 US Manufacturing ISM
… Exp 47.4 … Expected 48.3 … Previous 48.4. … Actual 49.3