Fed Chair Powell on Friday said the economic impact of new tariffs is likely to be significantly larger than expected but they are well-positioned to wait to consider adjustments to monetary policy. The Dollar Index while above 102, can head towards 104 in the near term. The Euro on the other hand is coming off as anticipated and can test 1.085 soon. EURINR is headed to the support near 93 from where a bounce back is expected. USDJPY above 144 can attempt to rise back towards 146-148. EURJPY had slipped below 160 and failure to sustain above it can drag it to 155 on the downside. AUDUSD on the fears of potential recession and larger cuts by RBA slipped below 0.62. The USDCNY has risen past 7.30 and can rise further to 7.33/35 in the coming sessions. Pound slipped below the support at 1.29 and is now headed to the deeper support at 1.275. USDINR tested 84.9475 on Friday before rising higher. A further rise to 86.40 is anticipated in the coming weeks.

Dollar Index (101.934) on Friday rebounded from 101.54 to 103.18 on greater than expected US NFP at 228K (139K). While the rise sustains above interim support near 102, a test to 1.035-1040 can happen in the near term. Any break below 101 if seen, can open the doors for 100 or even 98.

EURUSD (1.0931) is coming off as anticipated and can soon test the support around 1.09-1.085 region before attempting to rise back. Note that any break below 1.08 if seen, can drag it further to 1.07 in the near term.

EURINR (93.8426) is headed to the support at 93 which can be tested soon in the coming sessions. Thereafter, while it holds a range of 95-93 is likely to hold for a while. Only a decisive break past 95 or break below 93 can give further directional clarity.

EURJPY (160.24) had initially slipped below 160 to the low of 158.29 before recovering from there. Currently, it is back above 160 but still it will have to rise past current levels to keep the 160-164 range intact. Else, failure to do so can drag it to the deeper support at 155 in the coming sessions.

Dollar-Yen (146.71) while above 144, can bounce back towards 146-148 in the near term.

USDCNY (7.3140) has again rise past 7.30 and can now extend it further to 7.33/35 in the near term.

Aussie (0.6284) slipped sharply below 0.62 to the low of 0.5932 on the concerns that global trade war can slide economy into recession and the RBA can deliver bigger rate cuts in May. If the speculation continues further, the fall may get extended to 0.575. The pair will have to rise past support turned resistance at 0.61 to negate the anticipated fall.

Pound (1.3095) contrary to our view of rising to 1.35, pair halted the rise to 1.3207 and has been coming off since then. Currently it has broken below the support at 1.29 and while below it, the pair is likely to get dragged to 1.280-1.275 in the near term before attempting to rise back.

USDINR (85.7490) as anticipated tested 84.9475 on Friday before closing higher. On the NDF it is currently trading higher, and we expect the pair to head towards 86.40 in the coming weeks.

The US Treasury yields continue to fall. The bearish view is intact. There is room to fall more. The German yields have declined sharply contrary to our expectation. A break below the upcoming support will negate our earlier bullish view and drag them down. The 10Yr GoI is coming down as expected. It can test its support and then rise back again.

The US 10Yr (3.93%) and 30Yr (4.36%) Treasury yields continue to fall. The bearish view is intact. The 10Yr can fall to 3.8% (10Yr). The 30Yr can see 4.1% (30Yr) on the downside on a break below 4.3%.

The German 10Yr (2.57%) and 30Yr (2.98%) yields have declined below 2.6% and 3% respectively. 2.5% (10Yr) and 2.9% (30Yr) are crucial levels to watch. Failure to sustain above them will negate our bullish view and drag them down to 2.4%-2.3% (10Yr) and 2.8%-2.7% (30Yr). We will have to wait and watch.

The 10Yr GoI (6.4630%) has fallen back. View remains the same. 6.45%-6.4% can be tested and then a reversal is possible.

The sell-off in the global equity market persists. The Dow Jones plunged below 39000. A support near 37900 can be seen; if that holds, then the index can bounce to 40000. DAX looks bearish towards 19500-19000. Nifty can face the heat from the sell-off in the market, and it can come down to 23700-23400. Gift Nifty futures are already trading near 22000. Nikkei and Shanghai dropped more than 6%. Nikkei with some support near 30000 needs to hold this support to produce a bounce to 33000 and higher. Shanghai has recovered to the support of 3150. While it stays above 2150-2100, the index can move higher to 3200-3250.

The Dow (38,314.86, -5.5%) has tumbled below 39000. There is some support at 37900. Need to see if a bounce back to 40000 is happening from there or not.

DAX (20641.72, -4.95%) has declined sharply well below the expected level of 21300. View is bearish. There is a danger of seeing 19500-19000 on the downside.

Nifty (22904.45, -1.49%) has declined below 23000. It can fall to 22700 and even 22400 on the back of the sell-off in the global markets.

Nikkei (315919.79, -6.48%) took a nosedive to 30792 and slightly recovered. There is a support near 30000, which, if it holds, can allow the index to rise towards 33000 and higher.

Shanghai (3149.5811, -5.76%) tumbled and opened lower to 3095 and has recovered a bit. While it has recovered to the crucial support near 3150, if the index manages to sustain above 3150-3100, then it can bounce from here to 3200-3250.

Amid escalating concerns over renewed U.S. tariff pressures under Trump’s trade stance, most commodities have taken a sharp hit. Brent and WTI have broken key support levels and look bearish towards $ 60–$ 55 and $ 55–$ 50 respectively. Gold and Silver saw sharp pullbacks after testing lows, but further upside in Gold depends on holding above $ 3,000, while Silver remains vulnerable below $ 31–$ 32. Copper has rebounded from $ 4.03, with potential to rise towards $ 4.40–$ 4.60 if $ 4.00 support holds. Natural Gas fell to $ 3.70 and may test $ 3.60 before any recovery towards $ 4.00–$ 4.20.

Brent ($ 63.72) has plunged below its immediate support level due to pressure from Trump’s tariffs. It looks further bearish, with a potential decline towards the $ 60–$ 55 in the near term.

WTI ($ 60.21) has also broken below its immediate support level. It appears bearish towards the $ 55–$ 50 in the near term.

Gold ($ 3,070.20) tested a low of $ 2,985 today and has bounced back to current levels. As long as it sustains above $ 3,000, a rise towards $ 3,150–$ 3,200 is likely in the coming weeks.

Silver ($ 30.58) touched a low of $ 27.55 and has bounced back sharply to current levels. However, as long as it remains below the $ 31–$ 32 support turned resistance, a fall towards the $ 27–$ 26 is possible in the coming weeks.

Copper ($ 4.3080) has dropped sharply to a low of $ 4.03 and rebounded to current levels. While the support at $ 4.00 holds, a rally towards the $ 4.40–$ 4.60 could take place in the near term.

Natural Gas ($ 3.7710) has fallen back to $ 3.70, contrary to our expectations. It may test its immediate support at $ 3.60 in the near term. Thereafter, if the support holds, a bounce back towards the $ 4.00–$ 4.20 is likely.

9:00 14:30 EU Retail Sales
Exp – …Expected 0.5% …Previous -0.3%

DATA YESTERDAY
—————
5:00 10:30 IN Services PMI
… Exp 59.6 …Expected 57.7 … Previous 59.0 … Actual 58.8

12:30 18:00 US NFP
… Exp 191K … Expected 139K … Previous 151K … Actual 228K

12:30 18:00 US Unemployment Rate
… Exp – … Expected 4.1% … Previous 4.1% … Actual 4.2%

12:30 18:00 US Avg Hrly Earnings
… Exp 0.3 … Expected 0.3 … Previous 0.2 … Actual 0.3

12:30 18:00 US Average Hourly Earnings Production & Non Supervisory Employees
… Exp – … Expected – … Previous 0.36 … Actual 0.2

12:30 18:00 CA Labour Force
… Exp – … Expected 9.9K … Previous 1.1K … Actual – 32.6