The Dollar Index and the Euro continues to hold their respective ranges of 102-100 and 1.11-1.13. A break below 100 in index can drag it further to 98-96, while Euro can head towards 1.14 and higher on a break past 1.13. EURINR above 95 has a scope to rise back towards 97-98. EURJPY and USDJPY are trading near their immediate supports around 162 and 144 respectively. While the support holds, a bounce back is anticipated in both the pairs. AUDUSD can trade within the range of 0.635-0.650 for a while. The USDCNY can have immediate upside limited to 7.2250/23. Pound for now can trade within the range of 1.34-1.32. The USDINR can have downside limited to 85.25-85.00 and can eventually rise back towards 86.00.

Dollar Index (100.366) yesterday tested the lower end of its range of 102-100 before recovering from there. A decisive break below 100 can open the doors for 98-96.

EURUSD (1.1244) needs to see a rise past 1.11-1.13 range to head towards 1.14 and higher. Until then, the range can persist for a while.

EURINR (96.0679) had risen past 96 but could not sustain and started coming off from 96.4153 itself. Still, while the cross trades above 95, our target of 97-98 remains intact for now.

EURJPY (162.84) held the support near 162 quite well and if sustained can head towards the upper end of its range of 160-165. Only a break below 162 can initially drag it towards 161-160.

Dollar-Yen (144.83) is nearing the strong support around 144 from where a bounce back towards 148 can happen. Only a confirmed break below 144 if seen, can open the doors for 140 on the downside.

USDCNY (7.2226) is headed towards the resistance near 7.2250/23 region which can be tested soon. Thereafter, bias remains for the resistance to hold an initiate a fall back towards 7.20 or lower. Our view may turn out to be wrong only if a strong break past 7.23 happens.

Aussie (0.6445) needs to see a decisive break on the either side of its range of 0.635-0.650 for further directional clarity.

Pound (1.3361) tested 1.34 on the upside before coming down. The pair needs to break past 1.34 to test 1.35/36 on the upside. Else, the range of 1.34-1.32 can hold for some time.

USDINR (85.40) yesterday tested the high of 85.62 before turning lower. Note that the downside can be limited to 85.25-85.00 for now. Eventually, the pair is likely to move up towards 86.

The US Treasury Yields have come down sharply from their intraday highs on Monday. The resistances are holding well. That keeps alive the chances of seeing a fall from here in the coming days. The German yields sustain lower. Support is near current levels. While that holds, the yields can rise back and keep the bullish view intact. The 10Yr GoI has inched up. But resistance ahead can cap the upside. The broader view continues to remain bearish, and the yield can fall more going forward.

The US 10Yr (4.45%) and 30Yr (4.90%) Treasury yields have come down sharply from their highs of 4.56% and 5.04% respectively. We repeat that the yields have to break the 4.55%-4.6% (10Yr) and 5% (30Yr) resistance to get a rise to 4.8% and 5.10% respectively. Else they can fall back to 4.3% (10Yr) and 4.8% (30Yr).

The German 10Yr (2.57%) and 30Yr (3.05%) yields remain lower. 2.5% (10Yr) and 3% (30Yr) are key supports while above which the broader bullish view will remain intact to see 2.8% (10Yr) and 3.2% (30Yr) on the upside.

The 10Yr GoI (6.2904%) has inched up. But the 6.3%-6.35% region can cap the upside and keep the bearish view intact to see 6.2% and lower levels on the downside.

Most indices have moved up. The Dow has moved up shrugging off the initial dips after a credit rating cut by the Moody and can rise towards 43000 while Dax can test immediate resistance at 24000 from where a correction is possible. Nifty can rise towards 25500-26000 in the medium term while above 24800/600. Nikkei is bullish towards 38000-39000 while above immediate support at 37500. Shanghai can re-test resistance at 3400 while above 3350.

The Dow (42792.07, +0.32%) managed to rise and close in the green after an initial dip following a cut in the US’s credit rating by Moody. With the upside momentum intact, a test of 43000 is possible in the near term. Thereafter, a break above 43000 can open door for 44000-45000 in the medium term.

DAX (23934.98, +0.70%) is headed towards immediate resistance at 24000 which if holds, can lead to a dip towards 23500-23000. A rise past 24000 will be necessary in the medium term to open door for further rise to 25000. Watch price action near 24000 for a possible dip.

Nifty (24945.45, -0.30%) saw a slight corrective dip yesterday but could have scope to rise in the near term towards 25500-26000 while above 24800-24600. Overall trend is likely to be bullish.

Nikkei (37667.18, +0.45%) has risen after seeing a low of 37445.93 yesterday in line with our mentioned support at 37500. Now, while above 37500, the index has scope to rise towards 38000-38500 or even towards resistance at 39000 in the coming days.

Shanghai (3373.59, +0.18%) is holding above 3350 for now and has scope to rise towards resistance at 3400 in the near term. Failure to sustain above 3350 can take it lower to 3300.

Crude prices have rebounded, supported by Dollar weakness and key moving average support levels, with potential to rise further if the support holds. Gold remains firm above support and could head towards $ 3,300–$ 3,350, while Silver stays range-bound between $ 32-$ 34. Copper is testing resistance but may decline if unable to break above. Natural gas, after hitting support near $ 3.00, may see a rebound towards $ 3.30–$ 3.60.

Brent ($ 65.56) has bounced back due to dollar weakness and is currently holding above the 21-day moving average support. While it remains above $ 64, it can rise further towards its immediate resistance near $ 70 in the coming sessions.

WTI ($ 62.18) has bounced back from its 21-day moving average support, contrary to our expectation of a decline. If it sustains above $ 61, it can move up to test its immediate resistance at $ 66 in the near term.

Gold ($ 3,228.80) is holding above its immediate support and can move up towards $ 3,300–$ 3,350 in the coming weeks.

Silver ($ 32.52) remains range-bound between $ 34 and $ 32 until a breakout occurs on either side.

Copper ($ 4.5525) has bounced back again to test its immediate resistance. It is attempting to break above this level, but as long as it holds, we maintain our view of a potential fall towards $ 4.40–$ 4.20 in the coming weeks.

Natural Gas ($ 3.1340) has plunged to a low of $ 3.09, as anticipated. Immediate support is seen near $ 3.00; while that holds, a bounce back towards $ 3.30–$ 3.60 can be expected in the coming weeks.

4:30 10:00 RBA Meeting
… Exp – … Expected 3.85% … Previous 4.10%

12:30 18:00 CA Inflation Y/Y
… Exp – … Expected 2.4% … Previous 2.3%

DATA YESTERDAY
……………
2:00 07:30 CN Retail Sales
… Exp – … Expected 6.0 … Previous 5.9 …Actual 5.1

2:00 07:30 CN IIP (YoY)
… Exp – … Expected 5.7 … Previous 7.7 …Actual 6.1

9:00 14:30 EU Final CPI (YoY)
… Exp 1.7% … Expected 2.2% … Previous 2.2% …Actual 2.2%