Weaker US ADP Employment release and the uncertainty due to the tariffs led Dollar Index to extend the fall towards 104.115. Immediate support is coming around 104, while it holds preferred view is to see a bounce back higher. Euro tested the target of 1.08 and as the ECB is scheduled today, it might come down a bit if the rate cut happens. EURINR is nearing the crucial resistance zone between 94-95 region. USDJPY and EURJPY can remain ranged within 152-148 and 162-156 region respectively for now. AUDUSD has risen past 0.63 but a break past 0.64 will be needed to turn bullish. Pound if sustained above current levels, can test 1.30 on the upside. USDNCY above 7.240-7.225, can attempt to rise back towards 7.28 in the near term. USDINR slipped below 87 and any break below the support around 86.75 if seen, can make it vulnerable to test 86.50. Wacht price action closely around 86.75. Watch out for the US Trade Balance and ECB meeting scheduled today.

US ADP Employment coming down sharply at 77k (186k) and the speculations pertaining to the Trumps tariffs policy led Dollar Index (104.268) to fall to the low of 104.115, even below our mentioned target of 104.50. An immediate support is coming at 104, above which there could be some scope to see a bounce back towards 105-106 in the near term. Failure to do so, can drag it towards 102 in the medium term.

EURUSD (1.0801) tested the high of 1.0820 as anticipated on Dollar weakness. ECB is scheduled today, wherein it is expected to cut the rates by 25-bps. If that happens, then rise in Euro can see some relief. Overall, downside can be limited to 1.06 for now.

EURINR (93.9177) achieved the target of 94 as expected. Now, a crucial resistance zone can be seen between 94-95, suggesting limited upside for the cross. While it holds, the cross can witness a fall towards 93 or slightly lower in the near term.

EURJPY (161.08) extended the rally to the level of 161 as mentioned previously. Further, if the rise persists, can get extended to the resistance at 162 before getting peaked out. Only a strong break past 162 can maintain the bullishness in the trend, else a fall within its broad range of 162-156 can be seen.

Dollar-Yen (149.14) needs to see a decisive break on the either side of its range of 152-148 for further directional clarity. A confirmed break below 148 can open the doors for 145.

USDCNY (7.2442) is nearing the interim support at 7.24. But while it holds above the deeper support at 7.225 holds, it can attempt to rise back towards 7.28 higher in the coming sessions.

Aussie (0.6341) has given a break past the resistance of 0.63, still a confirmed rise past higher resistance at 0.64 will be needed for the pair to turn bullish. Till then, it can remain ranged within 0.62-0.64 region.

Pound (1.2896) has surged significantly past 1.28 and if sustained, can extend it further to 1.30. Consequently, even if the pair fails to sustain and starts coming off, the maximum downside could be limited to 1.26 for now.

USDINR (86.9160) slipped below 87 to the low of 86.93 yesterday. Immediate support is coming around 86.75. Price action around it would be crucial to watch to see whether it holds and take it higher or extends the fall further to 86.50. Watch price action closely around current levels. The upside targets of 87.80-88.00 can be delayed if the break below 86.75 happens.

The US Treasury yields have risen further. The 10Yr has broken its resistance and while that sustains, a further rise is possible. The US NFP data release tomorrow will be important to watch. The 30Yr is at its resistance and a break above it can take it higher. The German yields have surged following the new government’s spending plan. If the momentum sustains, we can see the yields rising further from here. On this background, the ECB meeting outcome today will be important to watch. A 25-bps rate cut is expected by the market. We will have to look for its future policy path. The 10Yr GoI has come down but has support to limit the downside. The bullish view is intact. We can expect the yield to rise back from the support.

The US 10Yr (4.31%) and 30Yr (4.59%) Treasury yields have risen further. The 10Yr can rise to 4.4%-4.5% if it sustains above 4.3%. The 30Yr on the other hand can rise to 4.75% on a decisive break above 4.6%.

The German 10Yr (2.79%) and the 30Yr (3.09%) yields have surged well beyond our expected level of 2.6% (10Yr) and 2.9%-3% (30Yr). If this rise sustains, the yields can target 3% (10Yr) and 3.3%-3.4% (30Yr)

The 10Yr GoI (6.7087%) has come down below 6.7250%, but may find support at 6.7%-6.9%. While the support holds, the bullish view will remain intact for a rise to 6.8%-6.85%.

The Dow Jones has recovered to slightly above 43000; upside could be limited to the resistance of 43400-43500. DAX has surged above 23000, negating the downside and reinforcing our target of 23500. Nifty witnesses a rise above 22300. A follow-through rise is required to rise past 22500 and reduce the chances of seeing a fall to 21700-21500. Nikkei has moved up but remains below 38000. While below 38000, a fall towards 36000-35000 looks possible. Shanghai has risen above 3350 and is approaching 3380-3400.

The Dow (43006.59, +1.14%) has recovered sharply and is just above 43000. Resistance at 43400-43500 can cap the upside and keep the index pressured to see 42000-41800 on the downside.

DAX (23081.03, +3.38%) has surged back. Support at 22200 is holding well. That keeps alive the chances of seeing 23500 on the upside.

Nifty (22337.30, +1.15%) has risen well. It is important to see if it gets a strong follow-through rise from here to breach 22500. That will give the Nifty a relief to revisit 23000 levels and reduce the danger of seeing 21700-21500 on the downside.

Nikkei (37725.97, +0.82%) has risen well but is below 38000. As long as it remains below 38000, the view remains bearish towards 36000-35000.

Shanghai (3365.2356, +0.71%) rose above 3350 and is heading towards 3380-3400.

Crude prices have tested their immediate support levels as the EIA reports a larger-than-expected build. While the respective support levels hold, a rise towards $ 70-71 (Brent) and $ 68-69 (WTI) can be expected in the near term. Gold and Silver may rise towards $ 2950-3000 and $ 33.5, respectively. Copper and Natural Gas are facing resistance near $ 4.8 and $ 4.6, respectively. These levels need to be broken for further bullish movement towards $ 5.0-$ 5.2 and $ 4.8-$ 5.0 in the coming weeks.

Brent ($ 69.79) and WTI ($ 66.80) fell to lows of $ 68.33 and $ 65.22 yesterday, as expected. While the immediate support levels hold, a bounce back towards $ 70-71 and $ 68-69, respectively, looks likely in the near term.

Gold ($ 2932.80) has dipped slightly, but the outlook remains biased for a rise towards $ 2950-$ 2970-$ 3000 levels in the coming weeks.

Silver ($ 33.24) has risen above $ 33 as expected and could move further up towards $ 33.5 in the near term.

Copper ($ 4.8170) has surged sharply from $ 4.54 to a high of $ 4.8250 yesterday. The immediate resistance is near $ 4.85, which needs to be broken for further bullish movement towards $ 5.0-$ 5.2. Otherwise, while $ 4.8 holds, a reversal towards $ 4.6-$ 4.5 cannot be ruled out.

Natural Gas ($ 4.4210) is facing resistance near $ 4.6. An inverted head and shoulder formation can be seen on the daily candles, with the neckline near $ 4.6, which needs to be broken for a bullish move towards $ 4.8-$ 5.0 or even higher in the coming weeks. Failure to break above $ 4.6 could bring the price down towards $ 4.2-$ 4.0.

0:30 06:00 AU Trade Balance
… Exp – … Expected 5.7 … Previous 5.1

10:00 15:30 EU Retail Sales
… Exp 0.0% … Expected 0.1% … Previous -0.2%

13:15 18:45 ECB Mtg
… Exp – … Expected 2.65% … Previous 2.90%

13:30 19:00 US Trade Balance
… Exp – … Expected -93.1 … Previous – 98.4

DATA YESTERDAY
—————
22:30 04:00 AU PMI
… Exp – … Expected – … Previous -22.7 … Actual -8.2

0:30 06:00 AU GDP
… Exp – … Expected 0.6% … Previous 0.3% … Actual 0.6%

5:00 10:30 IN Services PMI
… Exp 58.5 … Expected 61.1 … Previous 56.5 … Actual 59.0

7:30 13:00 CH CPI
… Exp -0.7 … Expected 0.5 … Previous 0.4

9:00 14:30 EU Composite PMI
… Exp – … Expected 50.2 … Previous 50.2 … Actual 50.2

13:15 18:45 US ADP Emp
… Exp – … Expected 144K … Previous 186K … Actual 77K