The Dollar Index tested our target of 102 before cooling down and while below it a fall back towards 100-99 can happen. If so, the Euro which slipped to 1.1065 can start rising towards 1.13 again. EURINR fell sharply to 94 but while above it there could be some scope to see rise back towards 95-96. EURJPY continues to trade within 165-160 region. USDJPY surged to 148.65 before coming down. While below 149, the pair can get dragged towards 146-145 in the coming sessions. AUDUSD is back within 0.645-0.635 range. The USDCNY below 7.20 can extend the fall to 7.15. Pound has dipped below 1.32 and if sustained, can extend the fall to 1.30. The USDINR can witness a lower opening in the onshore markets. The downside can be limited to 84.50 for now. IN & US CPI release scheduled today.

US and China agreeing to slash the tariffs for 90 days sowed the seeds of positive sentiments in the markets and Dollar Index (100.63) tested our target at 101.97 before coming down. Now, while below 102, the index can fall back towards 100-99 or even lower in the coming sessions.

EURUSD (1.1106) observed the low of 1.1065 yesterday on the Dollar strength. If the Index falls as anticipated, then Euro can rise towards 1.13 in the near term.

EURINR (94.1013) has slipped below the support near 94.70 region. Still, while above 94, there could be some scope to see a pullback towards 95-96 in the coming sessions. Only a break below 94 if seen, can open the doors for 93-92 on the downside.

EURJPY (164.22) tested the upper end of their range of 165-160 before cooling down. A support near 163 can be tested if the fall continues further. Overall, a decisive break on the either side will be needed for further directional clarity.

Dollar-Yen (147.94) surged past our target of 147 to the level of 148.65 before halting. While below 148.50-149.00, the pair can witness a fall back towards 146-145 in the coming sessions.

USDCNY (7.1901) in line with our bearish view has been coming off. While below 7.20, the fall can get extended to 7.15 in the near term before attempting to rise back higher.

Aussie (0.6380) failed to sustain its rise past 0.64 and reversed lower from 0.6461 itself. Currently it is back within its narrow range of 0.645-0.635. Need to see whether it falls below 0.63 or rises past 0.645/65.

Pound (1.3183) has slipped below 1.32 and failure to see an immediate rise past 1.32 can open the doors for 1.30 on the downside.

USDINR (84.7980) was closed yesterday. On the offshore it is currently trading below 85. We may witness a gap down opening in the onshore markets as well, but the downside can be limited to 84.50 for now. The Pakistan continues to violate the ceasefire and if the things escalate further, the USDINR can rise past 85 again.

The US Treasury yields have risen sharply as expected and could soon test near term resistances before a correction sets in. The German yields have also moved up sharply and could remain bullish for the next few sessions. The 10Yr GoI remained stable yesterday below 6.40%. The yield may initially test 6.35% before attempting to break above 6.40/45%.

The US 10Yr (4.453%) and 30Yr (4.89%) Treasury yields have risen well yesterday after the announcement of sharp de-escalation on US-China trade tariffs. We may expect the yields to test 4.5%-4.55% (10Yr) and 5% (30Yr) soon before a correction is seen from there.

The German 10Yr (2.662%) and 30Yr (3.108%) yields have also risen sharply. The yields can continue to rise towards 2.8% and 3.15/3.20% respectively.

The 10Yr GoI (6.3750%) remained below 6.40%. As mentioned yesterday, the yield may initially test 6.35% before attempting to break above 6.40/45% in the medium term.

Positive trade tariff announcement between US and China has lowered concerns of a possible US recession, showing a positive impact on the Dow Jones, which surged to close at 42410.10 yesterday, in line with our expected upmove. Further rise to 43000-43500 looks possible soon. Dax is bullish for a rise to 24000-24500 while Nifty can rise to 26000-26500 while above 24000 in the medium term but could see a short correction before the expected rise is seen. Nikkei and Shanghai are also bullish for a rise towards 38500-40000 and 3400, respectively.

The Dow (42410.10, +2.81%) rose in line with our expectation as the US announced 30% tariff on Chinese goods for 90-days, drastically lower than what it was earlier, easing concerns of US recession. Dow looks bullish and can extend its rise to 43000-43500 in the coming sessions.

DAX (23566.54, +0.29%) has also risen well and could be headed towards 24000-24500.

Nifty (24924.70, +3.82%) surged a massive 3.82% yesterday to close at 24924, almost testing our target of 25000. Although the index looks bullish to 26000-26500 while above 24000, we may expect a short corrective dip to 24500 initially.

Nikkei (38325.51, +1.81%) has risen on positive cues globally. The rise has been as expected and could soon test 38500. A break past 38500, if seen can be further bullish towards 40000.

Shanghai (3377.11, +0.23%) has also risen and could soon target 3400 followed by a corrective dip to 3350-3300. However, a break past 3400, if seen would negate the expected correction and indicate a fresh bullish signal.

Crude prices rose on easing US-China trade tensions. Brent needs to hold above $ 65 for further gains, while WTI must break $ 62 to extend higher. Gold continues its expected decline, eyeing $ 3,150–$ 3,100, and Silver remains range-bound between $ 34–$ 32. Copper stays bearish towards $ 4.40–$ 4.20. Natural gas may gradually rise towards $ 4.00–$ 4.20 despite a slight dip.

Brent ($ 64.71) surged to a high of $ 66.40 yesterday due to the easing of trade tensions between the US and China. It needs to sustain above $ 65 to move further up towards $ 68–$ 70. Otherwise, it remains vulnerable to a fall towards $ 60–$ 58 on the downside.

WTI ($ 61.72) tested a high of $ 63.61 before falling back to close near $ 62 yesterday. A sustained break above $ 62 could take the price higher towards $ 64–$ 66 in the near term. Otherwise, it could fall back to $ 58–$ 55.

Gold ($ 3,232.20) is falling as expected, having tested a low of $ 3,211.80 yesterday. A further decline towards $ 3,150–$ 3,100 looks likely in the near term.

Silver ($ 32.91) has seen a slight recovery, the outlook remains range-bound between $ 34–$ 32 for some time, unless a breakout occurs on either side.

Copper ($ 4.6075) has dipped as anticipated, and the outlook remains bearish towards $ 4.40–$ 4.20.

Natural Gas ($ 3.6920) saw a slight dip yesterday but the view remains bias for a rise towards $ 4.00–$ 4.20 in the near term.

6:00 11:30 UK Unemp
… Exp 4.6% … Expected 4.5% … Previous 4.4%

10:30 16:00 IN CPI
… Exp 3.65 … Expected 3.27 … Previous 3.34

12:30 18:00 US CPI (MoM)
… Exp 0.3 … Expected 0.3 … Previous -0.1

12:30 18:00 US Core CPI (MoM)
… Exp 0.2% … Expected 0.3% … Previous 0.1%

DATA YESTERDAY
……………
No major data released yesterday.