The Dollar Index is holding well above the immediate support around 107.75-108.00, above which targets of 110-111 remains intact in the near term. Euro is coming off as expected and a fall to 1.03 or even lower can be witnessed, while below 1.05. EURINR and AUDUSD continues to remain volatile within the 90-88 and 0.63-0.62 region respectively. USDJPY, on a sustained rise past 158 can head towards 160 or higher in the coming sessions. Pound and EURJPY are holding well below immediate resistances coming at 1.26 and 165 respectively. EURJPY has interim support at 163 but a rise past 165 will be needed to maintain its bullishness. Pound can extend the fall to 1.22 or lower, while below 1.26. USDCNY can gradually head towards 7.35. USDINR had slipped to the low of 85.6475 before rising back higher yesterday. A confirmed break past 85.80 can take it towards 86 in the current week itself. Watch out for the US ADP Employment data release scheduled today.

Dollar Index (108.596) witnessed an initial fall to 107.84 yesterday before closing at 108.68. While the support at 108.00-107.75 holds, we retain our view of a rise towards the resistance at 110-111 in the near term before possibly getting topped out. Only a break below the mentioned supports can delay the targets on the upside.

EURUSD (1.0352) was expected to have upside capped at 1.0450. In line with that, a test of 1.0434 was seen before it started coming down. Repeating from the previous reading, only a sustained rise past 1.05 can negate the bearish outlook. Else, a fall to 1.03 or even 1.02 -1.00 on a confirmed break below 1.03 can happen in medium term.

EURINR (88.8279) can continue to remain volatile within its broad range of 90-88 until a decisive break is seen on either side, to get further directional clarity. If EURUSD breaks below 1.03, then the cross can also be vulnerable to fall below 88 as well.

Dollar-Yen (158.03) needs to sustain its rise past 158 to head towards 160 or higher in the coming sessions. Else, it can again fall back within its range of 156-158.

EURJPY (163.64) tested 164.55, in line with our view of seeing. Arise to 164 before it started coming off sharply. Interim support is coming at 163. A rise past 165 will be needed to head towards 167 or even 170 in the medium term. At the same time any break below 163 if seen, can drag the pair to 162-160 in the coming sessions.

USDCNY (7.3309) is rising higher as anticipated and can test our target of 7.35 in the near term. Charts have enough room to see a rise to 7.40 but a confirmed break past 7.35 will be needed for that. Overall, the view is bullish for now.

Aussie (0.6228) continues to remain volatile within its narrow range of 0.63-0.62, a decisive break on either side will be needed for further directional clarity. Until then, the range can persist. 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.

Pound (1.2485) seems to be holding well below the resistance around 1.26 as 1.2575 was seen before it started coming off. While the resistance holds, a fall to 1.22 or lower cannot be ruled out. Strong rise past 1.26 will be needed to negate the expected fall.

USDINR (85.8080) had observed a low of 85.6475 before closing higher. Overall, the downside can be limited to 85.65 for now. A decisive break past 85.80 can take it higher to 86 within the current week itself.

The US Treasury yields have risen sharply and are moving up in line with our expectation. There is room to rise more from here. The German yields are getting a strong follow-through rise above their intermediate resistance. The extended rise is in progress now and yields can move up further. The 10Yr GoI remains lower. Outlook is negative and the yield can fall more.

The US 10Yr (4.68%) and 30Yr (4.91%) have risen sharply. They are heading up towards 4.8% (10Yr) and 5% (30Yr) in line with our expectation.

The German 10Yr (2.48%) and the 30Yr (2.71%) yields are getting a follow-through rise above 2.4% (10Yr) and 2.6% (30Yr). The extended rise to 2.6% (10Yr) and 2.8% (30Yr) is happening now. As such, the reversal move to 2.2% (10Yr) and 2.4% (30Yr) stands negated.

The 10Yr GoI (6.7483%) remains lower. View is bearish to see a fall to 6.7%-6.65%.

The Dow Jones, as expected, continues to decline, extending the downside towards 42000-41800.DAX has risen well above 20200, paving the way for a potential rise towards 20700. Nifty remains confined to the range of 23500-24100. A break above 23800 is essential to target the upper boundary of this range. Nikkei is unable to sustain above 40000 and is trading lower. A decisive rise past 40000 is needed to resume a bullish move towards 41000-42000. Shanghai holds below 3250 and could continue trading within the range of 3250-3150.

The Dow (42528.36, -0.42%) has come down. It remains vulnerable to see 42000-41800 and lower levels in the coming days.

DAX (20340.57, +0.62%) has risen further. Outlook is bullish to see 20700 on the upside. The danger of the fall to 19600-19500 stands negated now.

Nifty (23707.90, +0.39%) remained higher but stable. A strong follow-through rise above 23800 is needed to move up towards 24000. For now, the 23500-24100 range is intact.

Nikkei (39942.90, -0.35%) trades below 40000. It needs a rise past 40000 to hit the target of 41000-42000. Else, the index will again crawl back into the range of 40000-38000.

Shanghai (3212.0764, -0.56%) is holding below 3250. The index is expected to hold the range of 3250-3150. Within this range, the index remains vulnerable to a decline toward the support at 3150 upon a confirmed break below 3200. A decisive break above 3250 is necessary to confirm a move higher.

Brent and WTI can fall towards $ 75-74 and $ 72-71 respectively in the near term. Gold, Silver and Natural Gas remain bullish towards 2700-2750, 31.0-31.5 and 3.8-4.0 respectively. Copper looks ranged between 4.20-4.00 for some time.

Brent ($ 77.25) is holding below its immediate resistance at $ 77.5. As long as the resistance holds, a fall towards $ 75-74 can take place in the near term.

WTI ($ 74.67) is hovering below the immediate resistance. A fall towards $ 72-71 looks likely for the near term.

Gold ($ 2664.50) has risen in line with our expectations and can target 2700-2750.

Silver (30.72) is inching up gradually and can target 31.0-31.5 in the upcoming weeks.

Copper (4.1840) trades below 4.20. A range of 4.20-4.00 can be expected to hold for some time.

Natural Gas (3.4470) plunged to a low of 3.4270 yesterday due to warmer US weather forecast. The immediate support at 3.4 seems to be holding well for now. While above this, our view remains intact to see 3.8-4.0 in the upcoming weeks.

13:15 18:45 US ADP Emp
… Exp – … Expected 131K … Previous 146K

DATA YESTERDAY:
————-
7:30 13:00 CH CPI
… Exp – … Expected -0.1 … Previous 0.7 …Actual -0.1

10:00 15:30 EU Unemp
… Exp 6.5% … Expected 6.3% … Previous 6.3% …Actual 6.3%

13:30 19:00 US Trade Balance
… Exp -83.5 … Expected -78.4 … Previous -73.6 …Actual – 78.2