President Trump announced that the deal with Iran is complete and he authorises the toll-free opening of the Strait of Hormuz and removal of the US Naval blockade. While the agreement is made, it is expected to be signed on Friday to take effect. The Forex market looks stable and could react slowly to the positivity around the news as Iran still expresses its mistrust on the US. The Dollar Index is trading just above 99.55 which needs to break to fall lower while Euro has scope to rise to 1.17 on a sustained rise above 1.16. EURINR can decline to 110/109 while EURJPY has resistance at 186 which could hold and produce a rejection. USDJPY is likely to trade within the 159-161 range. USDCNY looks bearish towards 6.75 while Aussie can test 0.71-0.7150 before falling off from there later. Pound can move to 1.3550 before falling from there towards 1.3250-1.3200. USDINR is likely to open with a gap down but it needs to break below 94.80 for hopes of a decline towards 94.50 or lower. Watch price action today.

Dollar Index (99.559) is trading just above the immediate support at 99.50, which needs to break for a decline towards 99-98.90 to set in for the near term.

EURUSD (1.1598) has risen towards 1.16 as expected and could have scope to rise towards 1.17 or higher on the upside. Immediate support at 1.15 is likely to hold well for the near term.

EURINR (110.3277) has immediate resistance near 110.75/111 region and while below that the cross pair has enough scope for a decline towards 110-109 in the near to medium term.

EURJPY (185.75) can test resistance at 186 which could hold and produce a rejection towards 185 while the Dollar-Yen (160.17) could fluctuate in the 159-161 region for the medium term.

USDCNY (6.7584) has dipped below 6.76 and is headed towards 6.75 in the near term.

Aussie (0.7071) has scope to rise to 0.71-0.7150 which, if holds, can produce a decline towards 0.70 in the medium term.

Pound (1.3437) has moved up within the 1.3550-1.3250 region and could have scope to test the upper level before falling back later.

USDINR (95.10) is likely to open lower on the onshore markets today but has immediate support at 94.90 which needs to break, to bring 94.75/50 or lower into the picture.

The US Treasury and the German Yields have come down sharply. The US and Iran agreeing for a peace deal has dragged the oil price lower. That is weighing on the yields. The Treasury yields are coming close to their support. Failure to bounce back from there can trigger an extended fall. The German yields on the other hand have room to fall more from here. The 10Yr GoI has dipped below the support as expected. While this sustains, the yield can fall more from here.

The US 10Yr (4.42%) and 30Yr (4.92%) Treasury yields are coming down towards 4.4% and 4.9% (30Yr) respectively as expected. Failure to bounce back thereafter can drag them further lower towards 4.3% (10Yr) and 4.8% (30Yr).

The German 10Yr (2.99%) and 30Yr (3.55%) yields have come down further. That keeps intact our view of seeing 2.9%-2.85% (10Yr) and 3.45% (30Yr) on the downside.

The 10Yr GoI (6.8906%) has dipped below 6.9%. The fall to 6.8% can be seen now in line with our expectation. A rise above 6.95% is needed to negate this fall.

Global equities have surged sharply after President Trump announced a peace agreement with Iran, boosting risk sentiment across markets. Dow and DAX have moved higher in line with improving optimism and can rise further towards 53000 and 25500 respectively. Nifty can see a gap up opening and has scope to rise towards 24000 in the coming sessions. Nikkei has exceeded expectations and, if it breaks above 70000, can advance towards 70500-71000. Shanghai has also strengthened on the positive sentiment and can rise further towards 4100-4150.

Dow (52057.21, +0.87%) has exceeded our expectations and bounced back sharply, trading above 52000 after President Trump announced a peace agreement with Iran. A further rise towards 52500-53000 can be seen in the near term.

DAX (25052.11, +1.61%) has risen above 25000 in line with our expectations following Trump’s peace deal announcement. A further rise towards 25250-25500 can be seen in the coming sessions.

Nifty (23,622.90, +1.99%) moved higher above 23600 as expected on Friday. Today, it could see a gap up opening near 23800 or higher due to optimism surrounding the US-Iran peace agreement. A rise towards 24000 can be seen in the coming sessions.

Nikkei (69776.31, +3.65%) has surged beyond our expectation of 68000 and has tested a high of 69870 so far today. A break above 70000 would strengthen the outlook for a rise towards 70500-71000 in the coming sessions.

Shanghai (4079.26, +1.07%) has risen above 4050 in line with our expectations amid optimism surrounding the US-Iran peace agreement and can rise further towards 4100-4150.

Crude prices have fallen sharply after Trump announced a peace agreement between the US and Iran, with the Strait of Hormuz expected to reopen, easing concerns over supply disruptions. Brent and WTI need to sustain below $ 85 to extend losses towards $ 75-$ 70. Gold and Silver have recovered from recent lows and can rise further towards $ 4500-$ 4600 and $ 72-$ 74 respectively. Copper has bounced back above $ 6.50 and can extend gains towards $ 6.70-$ 6.75. Natural Gas remains weak but is holding above key support near $ 3.00, keeping the broader $ 3.00-$ 3.50 range intact.

Brent ($ 80.91) and WTI ($ 83.95) have fallen sharply below $ 85, contrary to our expectations, after Trump announced a peace agreement between the US and Iran, with the Strait of Hormuz expected to reopen, easing concerns over supply disruptions. The prices need to sustain below $ 85 to see a further decline towards $ 75-$ 70, thereby negating our earlier bullish view towards $ 100.

Gold ($ 4337.50) has bounced back sharply from recent lows after testing support near $ 4000. A further rise towards $ 4500-$ 4600 can be seen in the near term.

Silver ($ 70.32) has bounced back above $ 70 in line with our expectations. A further rise towards $ 72-$ 74 can be seen in the near term.

Copper ($ 6.54) has limited its downside as expected and bounced back above $ 6.50. A further rise towards $ 6.70-$ 6.75 can be seen.

Natural Gas ($ 3.0560) is weakening but has key support near $ 3.00. While this level holds, a broad range of $ 3.00-$ 3.50 can remain intact for some time.

GMT 6:30 IST 12:00 IN WPI
5.21 …Previous 8.30

GMT 9:00 IST 14:30 EU Ind Prodn (MoM)
…Previous 0.2

GMT 13:00 IST 18:30 IN Trade bal
…Previous -28.38

GMT 13:15 IST 18:45 US Industrial Production
0.08 …Previous 0.69

GMT 13:15 IST 18:45 US Capacity Utilization
75.81 …Previous 76.10

DATA YESTERDAY
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GMT 6:00 IST 11:30 UK Trade Bal
-26.98 …Market -27.00 …Previous -27.22 …Actual -26.05

{GMT 12:00 IST 17:30 IN CPI
3.69 …Market 4.00 …Previous 3.48