President Donald Trump withdrew his threats to fire Federal Reserve Chair Jerome Powell. The Dollar Index rose to 99.64 and declined a bit. Now it faces resistance at 99.60/65; a break could lead to 100-100.50, else a decline toward 98-96 is likely. The Euro and EURINR are coming off but has limited downside to the support near 1.13-1.12 and 96-95. Eventually, the pairs can rise towards 1.16-1.18 and 99 respectively. EURJPY is holding the range of 160-164 for now. USDJPY has bounced from 139.88 and can trade within 140-144 region for a while. AUDUSD is trading near the crucial level of 0.64. Need to see whether it sustains above it or breaks below. The USDCNY has risen as anticipated and can attempt to rise back towards 7.32-7.35. Pound appears peaked at 1.3423 itself and if the fall persists can extend further to 1.32-1.30 in the coming sessions. USDINR can limit the downside to 85.00-84.85 and start rising. US New Home Sales data release is scheduled today.

President Trump backed off threats to fire Fed Chair Jerome Powell, boosting market sentiment. The Dollar Index (99.26) rose to the high of 99.645. Immediate resistance is at 99.60/65; a break could push it to 100-100.50 before falling back to 98-96. Failure to break may trigger the fall from current levels.

EURUSD (1.1386) tested 1.1307 on Dollar strength. An immediate support is coming between 1.13-1.12 region, suggesting limited downside. Upon testing the support region or from current levels itself, the pair can eventually start ascending higher towards 1.16-1.18.

EURINR (97.1571) is coming off but has support around 96-95 region. While it holds, the cross can attempt to rise back towards 99 again.

EURJPY (161.91) continues to trade within its range of 160-164. A decisive break on the either side will be needed for further clarity.

Dollar-Yen (142.07) initially slipped to the low of 139.88 before turning higher. While above 140, the pair an oscillate within 140-144 region for a while. Only a break below 140 if seen can be bearish for the pair.

USDCNY (7.3113) has bounced well from the support around 7.29. While it holds, the rise can get extended to 7.32 or even 7.35.

Aussie (0.6400) is hovering near the crucial level of 0.64. The pair will have to sustain above it to head towards 0.655 and higher. Else, failure to do so can drag it back to 0.64-0.61 range.

Pound (1.3305) halted the rise at 1.3423 itself and started coming off. If the fall persists can extend further to 1.32-1.30 in the coming sessions. A strong rise past 1.35 will be needed to maintain the ongoing bullish trend.

USDINR (85.1930) is holding the 85 level quite well. The downside can be limited to 85.0-84.85 for now. Either from current levels or upon testing 84.85, the pair can start rising higher.

The US Treasury yields have come down. The expected rise seems to be not happening. Failure to bounce back from here can drag them lower in the coming days. The German yields have dipped further. Outlook remains bearish. The yields have room to fall more. The 10Yr GoI is hovering above a crucial support. A strong rise is needed from here to avoid the danger of seeing a deeper fall.

The US 10Yr (4.36%) and 30Yr (4.81%) Treasury yields have come down thereby reducing the chances of the rise to 4.6% and 5% respectively. The 10Yr can fall now 4.2%-4.1% while below 4.4%. The 30Yr can test 4.7%-4.65%.

The German 10Yr (2.44%) and 30Yr (2.86%) yields have dipped further. While below 2.6% (10Yr) and 3% (30Yr) the bearish view will remain intact. The yields can fall to 2.4%-2.3% (10Yr) and 2.8%-2.7% (30Yr).

The 10Yr GoI (6.3201%) is holding above 6.3%. A strong rise above 6.4% from here is needed to indicate a trend reversal. A break below the 6.3%-6.28% support zone will drag the 10Yr GoI to 6.15% and even lower.

US Stocks rebounded overnight as Trump hinted at a possible reduction of tariffs on China following a deal and said he has no plans to fire the FED chair J.Powell. Dow moved up from 37830 and can now test 39700/39800 while the rise sustains. A break above 39800 can be further bullish to 40500/800. Dax needs to sustain above 21000 to move up towards 22000/22300 else it could be vulnerable to test 20000. Nifty traded higher yesterday and while above 24000/23850, view is bullish towards 24500/25000. Nikkei has opened with a gap up and looks bullish towards 35000-36000 in the medium term. Shanghai looks subdued today but could see a slow rise towards 3350-3400 in the near to medium term.

The Dow (39186.98, +2.66%) has risen back well from the low of 37830. While this sustains, a test of 39700-39800 is possible. A break above 39800 can take it up to 40500-40800.

DAX (21293.53, +0.41%) is managing to hold above 21000. That keeps alive the chances of seeing a rise to 22000-22300. A break below 21000 will bring it under pressure for a fall to 20000.

Nifty (24167.25, 0.17%) remained higher but stable. While above the 24000-23850 support zone, the bias is bullish to see 24500-25000 in the coming days.

Nikkei (34733.16, +1.50%) opened with a gap up today and trades at 34758, from yesterday’s close at 34220, in line with our expectations. While above 34000, bullish view is intact towards 35000 initially and eventually towards 36000.

Shanghai (3295.74, -0.12%) looks stable today and does not show upward momentum like the other global indices. But a slow rise to 3350-3400 looks possible while above 3250.

Crude prices remain below resistance, suggesting short-term consolidation within $ 68–$ 62 (Brent) and $ 65–$ 60 (WTI) ranges. Gold has retreated from its all-time high and may correct further towards $ 3,100 if it stays below $ 3,500. Silver is range-bound between $ 33.5–$ 32.0 with potential to rise later. Copper is trending up, but needs to break $ 5.00 to target $ 5.20; else a pullback is likely. Natural Gas is holding support, with chances of moving up to $ 3.40 unless it breaks below $ 3.00.

Brent ($ 67.83) is holding below its resistance level. While it remains under this level, a range of $ 68–$ 64/$ 62 is likely to hold in the near term.

WTI ($ 64.06) is also trading below its resistance level. As long as it stays below this, a range of $ 65–$ 62/$ 60 can be expected in the near term.

Gold ($ 3,382.60) tested an all-time high of $ 3,509.90 and closed lower at $ 3,419.40 yesterday. It remains weak today as well, having tested a low of $ 3,316.00 so far. While it stays below $ 3,500, a corrective dip towards $ 3,200–$ 3,100 could occur in the coming sessions.

Silver ($ 32.77) fell to a low of $ 32.05 yesterday. Support is holding for now, so a narrow range of $ 33.5–$ 32.0 may persist for some time before a potential rise towards $ 34.5–$ 35.5 takes place.

Copper ($ 4.9040) continues to move upward as expected. Resistance from the 21-Day Moving Average lies near $ 4.95–$ 5.00, which needs to be broken for further movement towards $ 5.10–$ 5.20. Otherwise, a pullback to $ 4.80–$ 4.60 is possible.

Natural Gas ($ 3.0320) is holding just above immediate support. As long as this support holds, we maintain our expectation of a rise towards $ 3.20–$ 3.40. A sustained break below this level could drag prices down to $ 2.80–$ 2.60, though that appears less likely at the moment.

9:00 21:30 EU Trade Bal
Exp – …Expected 14.9 …Previous 14.0

14:00 19:30 US New Home Sales
Exp 699K …Expected 680K …Previous 676K

DATA YESTERDAY
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No major data released yesterday.