The Dollar Index trades slightly higher but still within the 98-99 region while Euro has dipped below 1.17. FED kept key rates unchanged yesterday while the markets await the ECB policy rates today. On the Euro we may expect the broad 1.1650-1.18 region to hold for the near term. The EURINR is likely to rise towards 111-112 while the EURJPY and USDJPY may remain broadly ranged within 186-188 and 157.50-160.50 region respectively. USDCNY is headed to 6.855 from where a rejection can be possible. Pound and Aussie are likely to bounce back from the lower end of the respective ranged of 1.3430-1.36 and 0.7250-0.71 in the near term. USDINR needs to fall back below 94.75 to head towards 94.50/30 else a straight rise to 95-95.25 cannot be negated.

Dollar Index (98.895) has been stable post the FOMC meeting as key rates are kept unchanged. A break below immediate support at 98, if seen will open up chances of a decline to 97/96 region else the index will have to break above 99 and sustain higher towards 100. Clarity on further direction is awaited on a confirmed break on either side of the 98-99 region.

EURUSD (1.1678) has dipped contrary to our expectations of seeing a rise to 1.18 or higher. Markets await for any rate hike cues for the rest of the year from the ECB policy meeting due today. While above 1.16/1.1650, there is scope for a rise towards 1.18.

EURINR (110.8773) tested 111 yesterday before coming off from there but we may expect a steady rally towards 111-112 again soon. Overall view is bullish above 110.

EURJPY (187.16) is likely to trade within the 186-187.50/188 region for the coming days.

Dollar-Yen (160.23) tested 160.47 yesterday. Today while the pair trades above 160, it would be important to see if the price breaks above 160.50 to rally towards 161-162 or will it fall back towards 159/158 again by the next week? Watch price action closely near 160.50.

USDCNY (6.8418) is headed towards 6.855 as expected. Thereafter we need to see if it can continue to move up or will it decline back towards 6.82/81.

Aussie (0.7121) has dipped to the support level of 0.71. we may expect the 0.7250-0.71 region to hold for the near term.

Pound (1.3481) is holding below 1.3560 and we may expect some trade within the 1.3450/34-1.3560 region in the next 1-2 sessions. Note that 1.36 is an important resistance for the near term.

USDINR (94.8550) rose sharply to close higher yesterday. While it holds firm above 94.75, there could be scope for a test of 95-95.25 before we see a pull back from there. Else, a break below 94.75 if seen and sustained can be bearish in the near term towards 94.50-94.30 sooner.

Overall the bond yields look bullish for the near term, as they have started to rally this week. The Fed kept key rates unchanged as expected but the US yields have rallied on sharp rise in crude oil prices triggering concerns for a higher inflation and weaker growth. The US Treasury Yields look bullish for now with scope of some more rise from current levels. The German yields have also risen significantly ahead of the ECB policy meeting due today. The German yields can also continue to move up for the rest of this week. The 10Yr GOI yield has scope to test 7.05/10% while above 6.99%.

The US 10Yr (4.422%) and the 30Yr (4.995%) have rallied after the FED policy meeting yesterday where the central bank kept rates unchanged. The main trigger came from a sharp rise in crude oil prices that threatened for a shoot up in inflation and weak growth in the coming months. A sustained upmove can take the yields towards 4.45/50% (10yr) and 5.2% respectively.

The German 10Yr (3.1158%) and 30Yr (3.6046%) yields have risen well from levels seen yesterday ahead of the ECB policy meeting today. The yields may continue to rise towards 3.15/20% and 3.70/75% respectively in the coming sessions of the current upward momentum sustains.

The 10Yr GoI (6.9928%) rose above 7% briefly yesterday and has managed to close just slightly lower. There is scope for a further rise to 7.05% or even higher to 7.07/10% in the coming sessions.

Dow has weakened below 49000 and can decline further towards 48500-48000. DAX can see a deeper fall towards 23500-23000 if it sustains below 24000. Nifty remains relatively strong above 24000 and can rise towards 24400-24600. Nikkei stays vulnerable below 60000 with downside towards 59000-58500. Shanghai has turned stronger than expected and may extend gains towards 4125-4150 in the near term.

Dow (48886, -0.26%) has fallen below 49000 in line with our expectations as tensions in the Middle East continue. A further decline towards 48500-48000 can be seen in the near term.

DAX (24048, -0.02%) broke below our mentioned level of 24000 and tested a low of 23903. A sustained break below 24000 would drag the index further down towards 23500-23000.

Nifty (24,177.65, +0.76%) tested a high of 24334 before closing. While it sustains above 24000, the up move can extend towards 24400-24600 over the week.

Nikkei (59445, +0.88%) remains below 60000 and needs to sustain below this level to see a decline towards 59000-58500.

Shanghai (4108.2, +0.03%) has bounced back sharply above 4100 contrary to our expectations and can rise towards 4125-4150 in the near term.

Crude prices remain highly volatile but strongly supported by ongoing Middle East supply disruptions. Brent can bounce towards $ 115-$ 120 while above $ 100, and WTI may rise towards $ 115-$ 120 on a break above $ 110. Precious metals remain weak with Gold vulnerable towards $ 4550-$ 4500 and Silver towards $ 70 before any bounce back. Copper is soft but may remain range bound within $ 6.00-$ 5.80 while support holds. Natural Gas is likely to continue trading within the $ 2.80-$ 2.55 range for now.

Brent ($ 110.75) continues to climb as stalled peace talks between the US and Iran are keeping the Strait of Hormuz closed, tightening global oil supplies. It surged to a high of $ 122.53 as expected and closed lower at $ 118.03 yesterday. Today it has opened lower at $ 111.59, but while above $ 100, a bounce back towards $ 115-$ 120 remains possible in the near term.

WTI ($ 107.17) surged sharply to test a high of $ 109.64 in line with our expectation of a rise towards $ 110. A break above $ 110 would take it further up towards $ 115-$ 120.

Gold ($ 4586.60) has broken below $ 4600 and can drag the price further down towards $ 4550-$ 4500.

Silver ($ 73.41) is falling and can decline towards $ 70 in the near term, from where a bounce back can be seen.

Copper ($ 5.9740) is falling and while above $ 5.80, a range of $ 6.00-$ 5.80 can hold for some time.

Natural Gas ($ 2.6310) can trade within a $ 2.80-$ 2.55 range for some time.

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