The Trump’s statement of tariffs on Mexico and Canada would proceed as planned led Dollar Index to limit the fall to 160.12. Still a strong break past 107 will be needed to turn bullish in the near term. Euro is nearing the immediate support around 1.0450. EURINR can trade within its narrow region of 91.50-90.50. USDJPY has limited upside to 152 and target of 148 is kept open for now. EURJPY has bounce well from support around 156 and can head towards 158/60 soon. AUDUSD can extend the fall to the support around 0.63. Pound needs to sustain above 1.26 to extend the rise towards 1.28 in the near term. Else, any break below 1.26 can make it bearish again. USDCNY is holding well above support around 7.225 and can rise towards 7.28. USDINR is trading within 86.50-86.80 region, break below which will be needed to head towards 86.15. US Case Schiller and US Consumer Confidence data releases scheduled today.

Dollar Index (106.474) limited the fall to the support around 106 and started rising back after the announcement came that tariffs on Mexico and Canada would proceed as planned. Still, a sustained rise past 107 will be needed to extend the ongoing rise further and negate the fall towards 105.50-105.00 in the near term. For now, anticipated fall towards 105 is not ruled out until further clarity.

EURUSD (1.0466) faded its gain on Dollar strength. The pair is nearing the immediate support around 1.045 region. While it holds, preferred view is to see a bounce back towards 1.050-1.055. Conversely, break below 1.045 can drag it further to 1.040 or even 1.035 as well. Watch price action closely around 1.045.

EURINR (91.1217) was expected to test 91.50 on the upside but it halted at 91.571 itself. Overall, narrow range of 91.50-90.50 can hold for now.

EURJPY (157.15) while above 156/55, view remains intact to see bounce back towards 158-160 in the near term.

Dollar-Yen (149.93) limited the fall to 148.84 yesterday. Any further rise from current levels can be limited to 152. Target of 148 on the downside is kept open until further directional clarity.

USDCNY (7.2538) has bounced well from the low of 7.2286. While the support at 7.225 holds, it can rise back towards 7.28 in the coming sessions.

Aussie (0.6351) is nearing the support around 0.63. Thereafter, whether it will hold or not will have to be seen. A strong rise past 0.64 will be needed to turn bullish in the near term.

Pound (1.2634) tested 1.2690 before coming down. Any fall below 1.26 if seen can make it vulnerable to test 1.25 initially. The pair will have to sustain above 1.26 to keep the target of 1.28 alive.

USDINR (86.7190) is holding well below the resistance around 86.75/80. Immediate range of 86.50-86.80 can hold for now. A break below 86.50, if seen can take the pair lower towards 86.15.

The US Treasury yields have declined below their key intermediate support. While this break sustains, the yields can fall more from here. The German yields remain stable. The bullish view is intact, and the yields can rise going forward. The 10Yr GoI remains stuck inside the narrow range. The immediate outlook is unclear.

The US 10Yr (4.38%) and 30Yr (4.63%) Treasury yields have come down further. The 10Yr has dipped below 4.4% and can extend the fall to 4.3%-4.25%. The 30Yr can fall to 4.5% on a break below 4.6%.

The German 10Yr (2.47%) and the 30Yr (2.75%) yields remain stable. Outlook is bullish to see a rise to 2.6% (10Yr) and 2.85% (30Yr) while above 2.4% (10Yr) and 2.6% (30Yr).

The 10Yr GoI (6.7036%) remains stable within the narrow 6.6750%- 6.7250% range. Immediate outlook is still unclear. The bias is bullish to break the broader 6.6%-6.7250% range on the upside and rise to 6.8%-6.85%.

The Dow Jones failed to sustain above 43500 and closed below it. The outlook remains bearish towards 43000-42000. DAX is holding the support near 22000 and needs a follow-through rise that would take the index higher to 23000. Nifty remains above 22,0, and as long as this support holds, a rise towards 23000 remains possible. Nikkei trades above the crucial level of 38000. Going ahead, above 38000, a bounce towards 39000-40000 is likely. Shanghai is approaching 3370-3400.

The Dow (43461.21, -0.08%) remains lower. The outlook is negative to see a fall to 43000-42000 while below 44000.

DAX (22425.93, +0.62%) is getting support around 22200. A strong follow-through rise is needed from here to go up to 23000 again. Else it can break 22000 and fall to 21000.

Nifty (22553.35, -1.06%) fell sharply yesterday and is managing to hold above 22500. While above 22500, we retain our bullish bias to see a rise back to 23000 and higher levels going forward. We prefer to approach the market from the buy side.

Nikkei (38345.94, -1.11%) opened lower and trades near the lower end of the sideways range of 38000-40000. While 38000 holds, the index could witness a rise to 39000-40000. If a break below 38000 is seen, then a sharp fall to 35000 and lower can be seen. A break below 38000 is least likely to happen.

Shanghai (3359.1688, -0.41%) opened lower but now is heading towards 3370-3400. A good support near 3350-3320 can be seen.

Crude prices have bounced back from their respective support levels and remain within a range of $ 77-$ 73 (Brent) and $ 73-$ 79 (WTI) for the near term. Gold and Silver may rise towards $ 3000 and $ 33.5-$ 34.0 respectively, in the coming weeks. Copper needs to break below $ 4.5 to turn bearish towards $ 4.4-$ 4.2; otherwise, it can bounce back to $ 4.6-$ 4.7. Natural Gas can rebound towards $ 4.2-$ 4.4 as long as it stays above $ 3.9-$ 3.8.

Brent ($ 75.19) and WTI ($ 71.18) have bounced back from their respective support levels in line with our expectations. A range of $ 77-$ 73 and $ 73-$ 69 respectively, can hold for some time.

Gold ($ 2966.40) is moving towards the long-term resistance near $ 3000. This resistance may hold and push the price down towards $ 2900-$ 2850 in the medium term. Alternatively, a sustained break above $ 3000 would confirm further bullish momentum towards $ 3100-$ 3300 for the long term.

Silver ($ 32.75) is hovering near its immediate support. As long as this holds, we maintain our outlook of seeing a rise towards $ 33.5-$ 34.0 in the coming weeks.

Copper ($ 4.5110) is holding just above its immediate support. A sustained break below this level could drag prices further down towards $ 4.4-$ 4.2. Otherwise, it could bounce back towards $ 4.6-$ 4.7 on the higher side.

Natural Gas ($ 3.9550) is holding above its immediate support near $ 3.9-$ 3.8. As long as this support holds, we retain our view of a rise towards $ 4.2-$ 4.4 in the near term, with a range of $ 4.6-$ 3.9/$ 3.8 expected for some time.

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

15:00 20:30 US Cons Conf
… Exp 102.2 … Expected 103.3 … Previous 104.1

DATA YESTERDAY
—————
9:00 14:30 GER IFO Bus Climate
… Exp 85.1 … Expected 85.9 … Previous 85.2 … Actual 85.2

9:00 14:30 GER IFO Bus Situations
… Exp 85.4 … Expected 86.5 … Previous 86.0 …Actual 85.0

9:00 14:30 GER IFO Bus Expn
… Exp 84.5 … Expected 85.2 … Previous 84.3 … Actual 85.4

9:00 14:30 EU CPI (YoY)
… Exp 2.3% … Expected 2.5% … Previous 2.4% … Actual 2.5%