Donald Trump announced 25% tariffs on Japan and South Korea, effective from 01-Aug-25. The Dollar Index needs a break past 99 to make the outlook bullish. Till then the range of 96-98/99 can hold. The Euro had slipped to 1.1686 but later rose above 1.17 again. The target of 1.19-1.20 is kept open for now. EURINR needs to give a break on either side of its 100-101 range. EURJPY has risen past 170 and if sustained, can head towards 175 in the near term. USDJPY and USDCNY can broadly trade within the 142-147/48 and 7.14-7.18 region respectively in the near term. The Aussie and Pound have immediate support around 0.645 and 1.35 level respectively and while it holds. The pairs can continue to trade within 0.645-0.660 and 1.35-1.38 range. USDINR tested 86.0275 before cooling down. Need to see whether the rise extends past 86 or the range of 86.00-85.50 holds for some time.

Dollar Index (97.345) rose to the high of 97.667 after Donald Trump announced that he would impose tariffs of 25% on Japan and South Korea. Still the index needs to see a strong rise past 98-99 to begin a fresh rally in the medium term. For now, the downside can be limited to 96 and immediate range of 96-98/99 can hold.

EURUSD (1.1742) had initially slipped to the low of 1.1686 but later recovered as well. While above 1.17, it can attempt to extend the rise towards 1.19-1.20. Only if a break below 1.16 happens, can negate the anticipated rise.

EURINR (100.6630) is oscillating between 100-101 region and a decisive break on the either side will be needed to get further directional clarity. The target of 102-103 is kept open while the cross trades above 100.

EURJPY (171.63) has finally risen past 170 and while the rise sustains, a test to 175 can happen in the near term.

Dollar-Yen (146.122) rose past 146 after the tariffs were imposed on Japan. Currently the pair faces immediate resistance near 147 level. While the resistance holds, a fall back towards 145 can happen. Broadly, a range of 142-147/48 can continue to persist in the near term.

The USDCNY (7.1707) tested 7.1744 before declining a bit from there. A break past 7.18 will be needed to head towards 7.20 in the coming sessions. Else, a range of 7.18-7.14 can remain intact in the near term.

Aussie (0.6485) extended the fall to 0.6485 but later recovered as well. Immediate support is coming at 0.645, above which the pair can attempt to rise back towards 0.65-0.66 in the coming sessions.

Pound (1.3632) is trading lower within its 1.38-1.35 range but while the support near 1.35 holds, it is likely to bounce back again.

USDINR (85.6830) rose sharply to the high of 86.0275 on potential intervention by RBI. Now, a break above 86.00 is needed to confirm further bullishness towards 86.25-86.50. Otherwise, it can fall back to 85.50-85.30 and range between 86.00-85.50/30 for some time.

The US Treasury yields have risen sharply. A further rise from here can turn the view positive and take the yields higher. That will negate our earlier bearish view of the yields reversing lower. The German yields have risen sharply. That keeps alive our bullish view. The yields can rise more from here. The 10Yr GoI remains stable within its sideways range.

The US 10Yr (4.39%) and 30Yr (4.92%) Treasury yields have risen sharply. A break above 4.4% (10Yr) can take the 10Yr up to 4.5% and higher. The 30Yr has risen above 4.9%. While that sustains a rise to 5% can be seen. Such a rise in both the 10Yr and 30Yr will then negate our bearish view of seeing a fall back to 4.1% (10Yr) and 4.6% (30Yr).

The German 10Yr (2.64%) and 30Yr (3.11%) yields have risen well. That keeps alive the bullish view of seeing a rise to 2.8% (10Yr) and 3.2% (30Yr).

The 10Yr GoI (6.3498%) has dipped slightly. The yield is stable within the 6.3%-6.4% range. The range is intact for now. The expected breakout above 6.4% is taking time.

The Dow Jones declined after Trump sent put letters of trade tariffs to about 12-14 countries and on news of a fresh political party by Elon Musk. The dow can dip to 43500-43000 before eventually rising towards 44000. On the other hand, Dax, Nikkei and Shanghai have risen and could be headed towards 25000, 41000 and 3500 respectively. Nifty was stable yesterday but could have scope to rise towards 25600 or higher in the medium term.

The Dow (44406.36, -0.94%) fell sharply at the start of the week as Trump sent out tariff letters to about 12-14 nations but has said he is open to negotiations before the final deadline of 1st August. Letters to more countries will be sent out soon. The Dow also fell on additional news of the launch of American party by Elon Musk. The Dow could face dip towards 43500-43000 in the near term before again picking up upside momentum in the longer run.

DAX (24073.67, +1.20%) rose on optimism around potential trade agreement between the EU and the US. While above 23500 and on a sustained break past 24000, the Dax can pick up momentum towards 25000 in the medium term. Failure to rise past 24000 can lead to a fall towards 23500-23000, Watch price action near 24000.

Nifty (25461.30, +0.0012%) was almost stable yesterday. It has support near 25250 above which there is scope for a bounce back towards 25600 or higher. Only a break below 25250, if seen, can take it sharply down towards 25200-25000.

Nikkei (39619.16, +0.08%) has risen after the news of Japan being subjected to 25% tariffs along with some other countries. While the support at 39500 holds, Nikkei could be bullish towards 41000; else it can fall towards 39000-38500 eventually.

Shanghai (3481.45, +0.24%) has risen and can re-test 3500. A break past 3500 will be needed thereafter, to keep the upward momentum towards 3600. Else we may expect trade within 3500-3400 region for some time.

Crude prices rose as expected, with Brent nearing $ 70 and WTI above $ 68, supported by Saudi price hikes and Middle East tensions. Gold remains range-bound between $ 3,250–$ 3,400, while Silver holds a bullish outlook towards $ 38. Copper may dip to $ 4.90 before rebounding towards $ 5.40. Natural gas bounced from $ 3.2750 and is likely to rise further towards $ 3.50.

Brent ($ 69.27) bounced back to a high of $ 69.94 yesterday, as expected, after Saudi Arabia raised prices for its main crude grade for Asian buyers next month by more than anticipated, coupled with rising tensions in the Middle East. A further rise towards $ 72–$ 74 looks likely in the near term.

WTI ($ 67.56) rose to a high of $ 68.32 yesterday in line with our expectations. A further up move towards $ 70–$ 72 can be seen in the near term.

Gold ($ 3,344.30) saw a low of $ 3,300 yesterday. A range of $ 3,400–$ 3,250 may hold for some time until a breakout occurs on either side.

Silver ($ 37.01) tested a high of $ 37.44 before closing lower at $ 36.90 yesterday. Our view remains bullish towards $ 38 in the near term.

Copper ($ 5.0210) fell to $ 4.98 in line with our expectations and may extend the decline further towards $ 4.95–$ 4.90 before a potential bounce back towards $ 5.20–$ 5.40.

Natural Gas ($ 3.3830) tested a low of $ 3.2750 and bounced back to close at $ 3.41 yesterday, in line with our expectations. While immediate support holds, a further rise towards $ 3.45–$ 3.50 is expected in the near term.

4:30 10:00 RBA Meeting
…Expectation 3.6 …Previous 3.9

DATA Last Thursday

9:00 14:30 EU Retail Sales
-0.1 …Expectation -0.8 …Previuos 0.3 …Actual -0.7