Tensions in the Middle East continue to trigger safe-haven dollar demand, taking the Dollar Index to 100.54. With immediate support at 99, there is scope for a rise to 101-101.50 soon. The Euro may test 1.14/1.13 with upside limited to 1.16. EURINR may hold above 105.50 and rise towards 107. A range of 105-107 may hold for now. EURJPY has support at 182 which can trigger a rise towards 183/184 while USDJPY could rise to crucial resistance near 160 before seeing a dip from there towards 158. USDCNY can slowly rise to 6.92/95 while above 6.85. Aussie and Pound are headed towards 0.71/72 and 1.33/35, respectively. The USDINR closed at the upper end of the mentioned range of 92.00-92.50 and a break above 92.50 can take it higher towards 92.75/93.00 soon. Higher India CPI release last week and rising Dollar Index can keep USDINR higher in the near term.

Dollar Index ($ 100.242) rose on Friday to $ 100.54, rising sharply as escalation in the Middle-East tensions have triggered for safe haven dollar demand. On the 3-day candles, it has hit resistance and if it holds can see a small corrective pull back towards $ 99 before again rising higher towards $ 101-101.50.

EURUSD (1.1446) fell to test 1.1410 on Friday. On the charts, Euro has triggered a bearish breakout on a fall below 1.15. While the decline sustains, Euro is likely to target $ 1.14-1.13 in the coming weeks with upside limited to $ 1.15/1.16.

EURINR (105.9796) is holding above 105.50 and is rising. We keep intact the broad range of 105-107 intact for the near term.

EURJPY (182.52) tested 182.255 on Friday. The cross pair has immediate support at 182 which if holds can produce a rise towards 183-183.50 in the near term. Failure to hold above 182 would drag the pair lower towards 180.

Dollar-Yen (159.47) has immediate resistance at 160 on the medium term charts and while that holds, a pull back towards 158/157 can be possible in the medium term. Watch price action at 160. Only a break past 160, if seen would bring in 162 into the picture.

USDCNY (6.8963) has scope for a rise to 6.92/93 in the near term while above 6.85.

Aussie (0.7010) is holding above support at 0.69 and has scope to rise towards 0.7050-0.71 in the near term.

Pound (1.3255) has important support at 1.30 which can be tested in the medium term before a bounce is seen towards 1.33/1.35 in the medium term.

USDINR (92.46) closed higher on Friday. We continue to look for a slow rise towards 92.50-92.75-93.00 in the coming weeks as the Middle-East tensions persist. Unless a strong dip in the Dollar Index is seen or an intervention from the central bank is seen, USDINR may not see a significant dip.

The US Treasury yields remain higher. The view remains bullish to see further rise from here. The German Yields are moving up in line with our expectation and are coming close to our expected levels. Charts indicate that an extended rise is possible. The 10Yr GoI remains stable and unclear for the near term. It can go either way from here. However, the big picture remains positive to see a rise eventually while it sustains above its support.

The US 10Yr (4.25%) and 30Yr (4.88%) Treasury yields sustain higher. They can rise to 4.3%-4.35% (10Yr) and 4.95%-5% (30Yr) from here. Support is at 4.2% (10Yr) and 4.8% (30Yr).

The German 10Yr (2.98%) and 30Yr (3.54%) yields are moving up as expected. The 10Yr has come closer to 3%. It can see an extended rise to 3.2% as well. The 30Yr on the other hand can test 3.65% for now.

The 10Yr GoI (6.6798%) remains stable and mixed. It can go either way from here in the near term. But while above 6.6%, the upside is open to see 6.8% eventually.

Global equities continue to remain under pressure. The Shanghai Composite looks relatively better poised among the lot. It manages to retain and oscillate within its sideways range. The Dow is coming down towards 46000. The fall can extend to 45000. DAX remains weak to see 22,800 on the downside. Nikkei can test 52000 initially and can even fall to 50000-48000 in the medium term. Nifty was knocked down badly and is approaching 23000 much faster than expected. There is room to see 22200-22000 after which a bounce is possible.

Dow (46,558.47, -0.26%) has come down to 46500 as expected and can now touch 46000. While below 48000, the downside will be open to see 45000.

DAX (23,447.29, -0.60%) remains weak to see 22,800 from here initially. A corrective bounce to 24,000 is possible thereafter before it goes down to 22,000 eventually.

Nifty (23,151, -2.07%) fell sharply on Friday. The fall to 23,000 is happening much faster than expected. While below 24,000, the downside is open to see 22,200-22,000. But thereafter we may have to look for a bounce.

Nikkei (53,440.40, -0.72%) is coming down towards 53000-52000 in line with our expectation. An extended fall to 50,000-48,000 looks likely over the medium term while below 56,000.

Shanghai (4,084.15, -0.28%) has come down within its range. It can continue to oscillate within the 4,000-4,200 (changed from 4,050-4,200) range.

President Trump has threatened to hit Iran’s oil export infrastructure on the Kharg island, which could trigger severe retaliation as about 90% of Iran’s exports are said to be shipped from the Kharg island. Crude prices may continue to rise in the near term, with immediate targets of $ 108-110 on Brent and $ 104-106 on WTI. Gold and Silver are in their corrective dips targeting $ 4800 and $ 75/70, respectively. Copper can test support at $ 5.6 which if holds can produce a decent bounce, else can get dragged towards $ 5 in the medium term. Natural gas is slowly inching higher. While a sustained rise above $ 2.8 holds, a test of $ 3.5 looks likely in the near term.

Brent ($ 103.18) and WTI ($ 97.97) continue to rise slowly in the near term. With immediate supports near $ 98-100 on Brent and $ 94-96 on WTI, there is scope for a rise towards $ 108-110 and $ 104-106 on Brent and WTI respectively.

Gold ($ 4989.50) and Silver ($ 78.89) have dipped from levels seen last week. While the focus has now shifted towards the energy sector, precious metals are in a corrective decline. Gold can test $ 4800 while Silver can dip to $ 75/70 region before any pause for a reversal is seen.

Copper ($ 5.7225) has immediate support near $ 5.6, which if fails to hold, can drag the price lower towards $ 5 in the medium term. Overall, the near-term looks bearish.

Natural Gas ($ 3.1180) dipped on Friday on forecasts of above-normal US weather. Near-term price movements have been volatile and the price will have to sustain above $ 2.80 to eventually rise towards $ 3.50.

GMT 2:00 IST 07:30 CN Retail Sales
…Previous 0.9

GMT 2:00 IST 07:30 CN IIP (YoY)
…Previous 5.2

GMT 6:30 IST 12:00 IN WPI
…Previous 1.81

GMT 9:30 IST 15:00 IN Trade bal
…Previous -34.7

GMT 12:30 IST 18:00 CA Inflation Y/Y
…Previous 2.3

GMT 13:15 IST 18:45 US Industrial Production
0.3 …Previous 0.7

GMT 13:15 IST 18:45 US Capacity Utilization
76.2 …Previous 76.2

DATA LAST FRIDAY
================
GMT 6:00 IST 11:30 UK Trade Bal GBP (Bln)
…Expectations -22.1 …Previous -22.7 …Actual -14.4

GMT 10:00 IST 15:30 EU Ind Prodn (MoM)
…Expectations 0.5 …Previous -1.4 …Actual -1.5

GMT 12:30 IST 18:00 US Personal Income
0.2 …Expectations 0.4 …Previous 0.3 …Actual 0.4

GMT 12:30 IST 18:00 US PCE Price Index M/M
0.3 …Expectations 0.4 …Previous 0.4 …Actual 0.4

GMT 12:30 IST 18:00 US Core PCE
0.3 …Expectations 0.4 …Previous 0.4 …Actual 0.4

GMT 12:30 IST 18:00 US GDP
…Expectations 1.40 …Previous 1.43 …Actual 0.65

GMT 12:30 IST 18:00 US Durable Goods Orders
…Expectations 0.5 …Previous -1.4 …Actual 0.0

{GMT 12:30 IST 18:00 CA Labour Force
…Expectations 11.1 …Previous -24.8 …Actual