Watch out for the BOC and FOMC scheduled today and ECB tomorrow. The Dollar Index at the moment appears uncertain on whether it will head towards 109 and higher or it will test deeper support around 106.00-105.50. The FOMC can shed some light on where the index might be headed. The Euro have fallen a bit but above 1.04, has potential to rise back towards 1.05 and higher. Only a break below 1.04 can be bearish for pair. EURINR can trade within 91-90 region for a while. USDJPY and EURJPY needs to see a break on either side of their respective range of 155-157 and 164-160. AUDUSD and Pound are trading lower within their ranges of 0.63-0.62 and 1.26-1.24. USDCNY is closed today. USDINR is hovering near the upper end of its range of 86.20-86.60 region, need to see whether the rise extends past 86.60 or not.

Dollar Index (107.910) looks stable above 107.75 for now. FOMC is scheduled today, while the market expects the rates to remain steady at 4.50%, the press release post meeting would be important to watch for further directional clarity. Till then, view remains uncertain on whether the Index targets 109 on the upside or whether it breaks below 107 to test 106.00-1.0550 region in the medium term.

EURUSD (1.0429) has been coming off but overall, it has sustained well above 1.04. While it holds, pair can again attempt to rise back towards 1.05 and higher again. Only a break below 1.04 if seen, can bring back the lower levels of 1.0350-1.0300 into the picture.

EURINR (90.3294) is trading near the immediate support around current levels. While above 90, it can trade within 91-90 region for a while. Only a break below 90 can make it vulnerable to test 89 again on the downside.

EURJPY (162.30) continues to remain volatile within the range of 164-160 and Dollar-Yen (155.61) had initially slipped to the low of 154.49 before rising back within its 155-157 range. A decisive break on either side will be needed for further directional clarity.

USDCNY (7.2502) is closed today. While above 7.250-2.225, a rise back towards 7.28/29 can be seen in the near term.

Aussie (0.6237) and Pound (1.2443) are trading lower within their respective ranges of 0.63-0.62 and 1.26-1.24. Any break below 0.62 and 1.24 if seen, can make them vulnerable to test 0.61-0.60 and 1.22 respectively on the downside.

USDINR (86.5560) is trading higher within the immediate range of 86.20-86.60 for now. A decisive break past 86.60 if seen, can indicate further bullishness. Our view of pair falling towards 86.00-85.90 is kept on hold until further clarity post FOMC today.

The US Treasury yields continue to come down. The can fall further and test their support before resuming the broader uptrend. The US Fed meeting outcome tonight will be important to watch. Market expects the Fed to keep the rates unchanged in its meeting today. The German yields have bounced. But resistance ahead can cap the upside and drag the yields lower again. The ECB meeting outcome tomorrow will need a close watch. The 10Yr GoI has good support which is likely to limit the downside now. We can expect the yields to rise going forward.

The US 10Yr (4.52%) and 30Yr (4.77%) yields continue to come down. 4.5%-4.4% (10Yr) and 4.7%-4.6% (30Yr) can be tested and then the broader uptrend can resume targeting 5% (10Yr) and 5.2% (30Yr) over the medium-term.

The German 10Yr (2.56%) and the 30Yr (2.78%) yields have bounced slightly. While below 2.6% (10Yr) and 2.8% (30Yr) the view remains bearish to see 2.4% (10Yr) and 2.6% (30Yr) on the downside.

The 10Yr GoI (6.6888%) yield had recovered sharply from the low of 6.6254% and then bounced sharply. 6.65%-6.6% is a good support which can limit the downside. We expect the yield to rise above 6.7% and move up to 6.8%-6.85% again in the coming weeks.

The Dow Jones and DAX have risen well. The Dow Jones remains bullish and could target 45100. Similarly, the DAX is poised for a rise towards 21500-21900. Dow Jones could target 45100, and DAX is expected to witness a rise towards 21500-21900. The Nifty, having closed below 23000, appears weak and is at risk of further declines. The index may test lower levels at 22800-22500 before any potential reversal. Nikkei is holding above 39000. Further, the index is expected to hold the range of 38000-40000.

The Dow (44,850.35, +0.31%) is moving up towards the upper end of the 41850-45100 range in line with our expectation.

DAX (21430.58, +0.70%) has risen back well. While above 21000, a test of 21500-21900 is likely to be seen first and then a reversal is possible.

Nifty (22957.25, +0.56%) failed to sustain the rise above 23000 yesterday. That keeps it vulnerable to see 22800-22500 on the downside before reversing higher. We reiterate 22500 or 22000 (maximum) are the levels from where we expect the fall to end and the Nifty to see a reversal.

Nikkei (39232.70, +0.55%) continues to trade within the 38000-40000 range. A break below 39000 could trigger further declines toward 38000, while sustained strength above 39000 may keep the range intact.

Shanghai (3250.6007, -0.06%) will remain closed until February 4, 2025, due to the Chinese New Year holidays. Trading activity is expected to resume thereafter.

Brent and WTI have bounced back from their respective support levels and could rise towards $ 79-81 and $ 75-77, respectively. Gold remains bullish, targeting $ 2800-2850, while Silver is likely to remain in a range between $ 31.5-30.0. Copper and Natural Gas retain their bearish outlooks, with targets of 4.1 and 3.0-2.8, respectively.

Brent ($ 77.42) and WTI ($ 73.75) have bounced back from their respective supports as expected. A further rise towards $ 79-81 and $ 75-77 is likely in the near term.

Gold ($ 2772.10) has bounced back above $ 2750 from yesterday’s low of $ 2737. A further rise towards the mentioned levels of $ 2800-2850 looks probable.

Silver ($ 30.93) bounced sharply to $ 30.96 yesterday. Immediate resistance is near $ 31.5, and while this holds, a range of $ 31.5-30.0 may persist for some time.

Copper ($ 4.2280) saw a slight rise yesterday, but the overall outlook remains bearish with a target of 4.1 for the near term.

Natural Gas ($ 3.08) has declined in line with expectations. It may continue to fall, with targets of 3.0-2.8 in the upcoming sessions.

1:30 07:00 AU CPI
… Exp 3.5% … Expected 2.5% … Previous 2.8%

14:00 19:30 BOC Meeting
… Exp – … Expected 3.0% … Previous 3.3%

18:00 23:30 US FOMC Meeting
… Exp <4.50% ... Expected <4.50% ... Previous <4.50% DATA YESTERDAY
—————
13:30 19:00 US Durable Goods Order
… Exp -0.8% … Expected 0.1% … Previous -2.0% …Actual -2.2%

14:00 19:30 US Case Schiller
… Exp – … Expected 4.2% … Previous 4.2% …Actual 4.3%

15:00 20:30 US Cons Conf
.. Exp 101 … Expected 106 … Previous 105