The Dollar Index is nearing the support around 107.75 region, need to see whether it holds and bounces back again or extends the fall further. The Euro on a sustained rise past 1.0450 can head towards 1.05 or higher. EURINR if sustained can rise towards 91 in the near term. BOJ is scheduled today. USDJPY above 155 has scope to see a rise back towards 158 in the near term. AUDUSD and Pound have risen past 0.63 and 1.24 and is sustained, can test higher resistance at 0.64 and 1.26 respectively. EURJPY has immediate upside capped at 164 and a break below 160 if seen, can drag it lower to 157-156. USDCNY has dipped slightly below deeper support at 7.25 and if the fall extends further, can be vulnerable to test 7.20 on the downside. USDINR can hold the range of 86.60-86.20 in the near term.

Dollar Index (107.924) has been coming off and is likely to test the support around 107.75. Thereafter, whether it bounces back higher again or extends the fall further is uncertain at the moment. The upside can be limited to 109 for now. Else, a decisive break below 107.75 if seen, can drag it further to the deeper support around105.50 region in the medium term. Watch price action closely around 107.75.

EURUSD (1.0444) is nearing the resistance around 1.0450 which needs to be broken to head towards 1.0500-1.0550. Alternatively, a break below 1.04, if seen can make it vulnerable to test 1.0350-1.0300.

EURINR (90.1621) has risen past 90 again and if sustained, can target 91 on the upside.

EURJPY (162.82) has been rising since the last few sessions but for now, the upside looks limited to 164. The cross can trade within its broad region of 160-164 for a while.

We need to be cautious for Dollar-Yen (156.00) as BOJ policy meeting is scheduled today. While the market expects a 25 bps rate hike, whether it will happen or not is uncertain. For now, while above 155, the target of 158 is alive. At the same time if the rate hike happens and the pair slips below 155, it can turn bearish in the near term.

USDCNY (7.24950) has slipped below our deeper support at 7.25 and if the fall extends further, it can target 7.20 or even lower levels in the near term. Only a rise past 7.25 will negate the expected fall.

Aussie (0.6319) and Pound (1.2401) have risen past interim resistances at 0.63 and 1.24. If the rise sustains, they can get extended towards higher resistances at 0.64 and 1.26 respectively. The downside targets of 0.62-0.61 and 1.20 are not ruled out until further rise happens.

USDINR (86.26800) is currently trading lower on the NDF. We might witness a lower opening in the onshore markets today but overall, the range of 86.60-86.20 is likely to persist in the near term.

The US Treasury and the German yields have bounced slightly. But the upside is likely to be capped. The near-term outlook is bearish. Both the German and the US Treasury yields can fall further from here before reversing higher again. The 10Yr GoI remains lower and stable. There is room to fall further from here and then a reversal can happen.

The US 10Yr (4.63%) and 30Yr (4.86%) yields have bounced. But upside could be capped at 4.65% (10Yr) and 4.9% (30Yr). A fall to 4.5%-4.4% (10Yr) and 4.7%-4.6% (30Yr) is likely to happen first. Thereafter the broader uptrend can resume targeting 5% (10Yr) and 5.2% (30Yr) over the medium-term.

The German 10Yr (2.55%) and the 30Yr (2.78%) yields have inched up further. But while below 2.6% (10Yr) and 2.8% (30Yr), the view will remain bearish to see 2.4% (10Yr) and 2.6% (30Yr) on the downside.

The 10Yr GoI (6.7341%) yield remains lower and stable. A fall to 6.7%-6.65% is likely to be see first before a reversal happens. Resistance will be in the 6.75%-6.77% region.

The Dow Jones and DAX have risen as anticipated. Dow Jones is advancing towards 45,000, while DAX is nearing the resistance at 21,500, from where a reversal might occur. Nifty has edged up slightly but lacks the momentum to breach 23,500, holding steady within the range of 23,000-23,400. While below 23,500, the risk of breaking below 23,000 and falling towards 22,800-22,500 persists. Nikkei has climbed above 40,000; sustaining above this level could lead to a further rise toward 41,000. Shanghai, after losing its intraday gains and closing below 3,250 yesterday, is now holding above 3,200 and attempting a rise past 3,250 toward 3,300-3,350.

The Dow (44565.07, 0.92%) is heading up towards the upper end of the 41850-45100 range in line with our expectation.

DAX (21411.53, +0.74%) is coming close to the key resistance level of 21500. Need to see if a corrective fall to 21000 and lower is happening from 21500 itself or after an extended rise to 21850-21900.

Nifty (23205.35, 0.22%) is moving up but lacks strength. For now the 23000-23400 range is intact. The chances of a fall to 22800-22500 is still a possibility before a trend reversal happens.

Nikkei (401992.80, +0.59%) trades above 40000. While it stays above 40000, a rise towards 41000 is likely. However, if it fails to hold above 40,000, the index may remain within the range and decline toward 39,000-38,000.

Shanghai (3244.4184, +0.47%) came lower and trades below 3,250. While above 3200, the index is heading towards 3250 and higher to 3300-3350.

Crude prices are currently holding above their respective 21-Day moving average support levels. We have to wait and watch whether the support holds and push the prices higher or breaks lower and falls down to 76/75 and 73/72 respectively. Gold, Copper and Natural Gas look bullish towards 2800-2850, 4.4 and 4.2-4.0 respectively. Silver needs to break above it’s immediate resistance to be bullish towards 33-34 or else can fall down to 30.

Brent ($ 78.05) and WTI ($ 74.35) have fallen slightly but hold above their 21-Day moving average support levels. We have to see whether this level holds and push the price higher towards 82-84 and 77-79. Or else a fall to 76/75 and 73/72 respectively is possible.

Gold ($ 2776.10) is marching up towards 2800 as expected. It can test 2800-2850 in the near term while above 2750.

Silver (31.18) , in line with our alternate expectation, fell to a low of 30.47 yesterday before closing higher. Immediate resistance at 31.8 needs to be broken to see earlier mentioned levels of 33-34. Else it can be bearish towards 30 in the upcoming weeks.

Copper (4.3615) as expected, has tested a low of 4.23 yesterday before bouncing back to current levels. A further rise towards 4.4 can be seen in the upcoming sessions.

Natural Gas (3.9310) has reverted back to slightly below 4 but our view remains intact to see a rise towards 4.2-4.4 in the near term.

23:30 05:00 JP CPI
… Exp 3.1 … Expected 3.0 … Previous 2.9

0:01 05:31 UK Cons Conf
… Exp -16.0 … Expected -18.0 … Previous -17.0

3:00 08:30 BOJ Meeting
… Exp – … Expected 0.5% … Previous 0.3%

15:00 20:30 US Existing Home Sales
… Exp 4153K … Expected 4190K … Previous 4150K

DATA YESTERDAY
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No major data released yesterday.