The Dollar Index is trading near the support of around 108.75. For now, the view remains intact to see a rise towards 111. The Euro can have an upside capped at 1.0350/04 and can fall to 1.02 or lower in the near term. EURINR continues to remain volatile within the 90-88 region. USDJPY has immediate support around 155, above which there could be scope to see a rise back towards 158 in the near term. AUDUSD and Pound appears bearish towards 0.61-0.60, 1.20 respectively while below 0.6250 and 1.24/26. EURJPY is trading at the crucial level of 160, so we need to see whether it holds or not. The upside is capped at 164. USDCNY can gradually head towards 7.35. USDINR has risen well and can head towards 86.70 soon. US Housing Starts, US Industrial Production and US Capacity Utilization data releases are scheduled today.

Retail sales came out lower than the previous release at 0.6% (0.9%). This led Dollar Index (108.899) to again fall near the support around 108.75. While this support holds, we retain our view of the Index heading towards 111 in the near term. Only a break below 108 if seen, can make it bearish for a while and delay the targets on the upside.

EURUSD (1.0306) is attempting to rise back but below 1.0350-1.0400, a fall to 1.0200-1.0150 looks likely.

EURINR (89.2041) is facing rejection from around 89.50. For now, a broad range of 90/89.50-88 is likely to hold for a while.

Dollar-Yen (155.36) is trading near the crucial support around 155. While the support at 155 holds; the pair can still attempt to rise back towards 158. Only a confirmed break below 155 can make the outlook further bearish.

EURJPY (160.14) can test 157-156 on the downside on a break below 160 . Any rise from current levels if seen can be limited to 164.

USDCNY (7.3269) can target 7.35 on the upside or even 7.40 on a confirmed rise past 7.35. The targets can get delayed due to low volatility in the pair.

While the resistances at 0.6250-0.6300 and 1.24/26 hold in Aussie (0.6213) and Pound (1.2235) respectively, the outlook appears bearish to 0.61-0.60 and 1.20 respectively.

USDINR (86.5660) bounced from the low of 86.41 itself. While the rise is sustained, a test of 86.70 can happen. Therein, a range of 86.70-86.30 can persist for a while.

The US Treasury yields continue to fall. There is room to fall more before the overall uptrend resumes. The German yields remain lower. Failure to bounce back immediately from here can drag them lower. The 10Yr GoI has declined sharply, breaking below its support. This is contrary to our expectation. The yield can fall more from here.

The US 10Yr (4.61%) and 30Yr (4.85%) yields are coming down towards 4.6% and 4.8% respectively as expected. An extended fall to 4.5% (10Yr) and 4.7% (30Yr) is possible before the overall uptrend resumes targeting 5% (10Yr) and 5.2% (30Yr) over the medium-term.

The German 10Yr (2.54%) and the 30Yr (2.78%) yields remain lower. While below 2.6% (10Yr) and 2.8% (30Yr) the yields can fall to 2.4% (10Yr) and 2.6% (30Yr). That in turn will negate the rise to 2.8% (10Yr) and 3% (30Yr).

The 10Yr GoI (6.7483%) has come down sharply below 6.8% contrary to our expectation. The yield can now test 6.7%-6.65% again. The rise to 6.9% stands negated.

The Dow Jones closed lower. While above 43000-42750, it could attempt to rise past 43400 and move higher towards 44000. The DAX has risen and is nearing 20,700. A sustained break above 20,700 would open doors for a further rise to 21,300-21,500. The Nifty rose slightly. A decisive break above 23,500 is crucial to exit the current range of 23,000-23,500 and avoid the risk of slipping below 23,000, which could trigger a fall toward 22,500. The Nikkei has dipped but continues to trade above the lower boundary of its sideways range of 38,000-40,000. While it holds above 38,000, a rise toward 39,000 and beyond remains likely. The Shanghai index failed to sustain above 3,250 and has retreated back into its sideways range of 3,150-3,250.

The Dow (43153.13, -0.16%) has dipped slightly. As mentioned yesterday, a strong rise above 43400 can take the Dow up to 44000. Support is at 42750. We will have to wait and watch.

DAX (20655.39, +0.39%) sustains higher and keeps intact the bullish view. A break above 20700 can take it up to 21300-21500.

Nifty (23311.80, +0.42%)) is inching up. A test of 23500 looks likely. 23000-23500 can be the trading range for now. While below 23500, need to be cautious for a fall to 22500.

Nikkei (38,193.00, -0.98%) has dipped below 38,500 and is trading near 38,000. While it holds above this key support, a further advance toward 39,000 and 40,000 remains likely.

Shanghai (3,231.9364, -0.12%) has fallen back below 3,250. Within the broader range of 3,150-3,250, it is likely to test the lower levels of 3,200-3,150.

Crude prices have fallen slightly but the outlook remains bullish towards 84-86 (Brent) and 82-84 (WTI) for the near term. Gold and Silver needs to break above their immediate resistances to be bullish towards our target levels of 2800-2850 and 33-34. Copper has broken above it’s immediate resistance and looks bullish towards 4.5-4.6. Natural Gas can test its immediate resistance at 4.4-4.5 in the coming sessions.

Brent ($ 81.81) and WTI ($ 78.26) have fallen slightly but our view remains intact to see rise towards 84-86 and 82-84 in the near term.

Gold ($ 2745.90) has broken slightly above it’s immediate resistance. It needs to sustain above this to see a further rise towards 2800-2850 in the coming weeks.

Silver (31.39) is holding just below its immediate resistance at 32. A break above this would take it higher towards 33-34 in the coming months. Else it can trade between 32-31 for some time.

Copper (4.4490) has broken above it’s immediate resistance at 4.4 and rose to a high of 4.4470 yesterday. While above 4.4 it can rise further towards 4.5-4.6.

Natural Gas (4.2750) saw an high of 4.3280 yesterday as expected. It can move further up to test 4.4-4.5.

10:00 15:30 EU CPI (YoY)
… Exp 2.1% … Expected 2.4% … Previous 2.2%

13:30 19:00 US Housing Starts
… Exp 1283K … Expected 1330K … Previous 1289K

14:15 19:45 US Industrial Production
… Exp -0.1% … Expected 0.3% … Previous -0.1%

14:15 19:45 US Capacity Utilization
… Exp 76.5% … Expected 77.0% … Previous 76.8%

13:00 01:30 US TICS (Net foreign purch of long-term Sec)
… Exp – … Expected – … Previous 152.3

DATA YESTERDAY:
————-
1:30 07:00 Australia Labour Force
… Exp – … Expected 14.5K … Previous 28.2K … Actual 56.3K

7:00 12:30 UK Trade Bal
… Exp -16.0 … Expected -18.0 … Previous -19.0

10:00 15:30 EU Trade Bal
… Exp – … Expected 7.2 … Previous 7.0 …Actual 12.9

13:30 19:00 US Retail Sales (MoM)
… Exp 1.2% … Expected 0.6% … Previous 0.9% … Actual 0.6

13:30 19:00 US Philifed Index
… Exp -1.6 … Expected -7.0 … Previous -16.4 … Actual 44.3