Softer US PPI yesterday after the softer CPI release earlier has kept the Dollar index subdued. Although the reading is bullish, the required volume to pull the index up seems to be missing. Most other currencies also look stable at levels seen in the previous session. Euro is stable below 1.1550, EURJPY below 184, Aussie above 0.70, Pound below 1.35, USDJPY above 159 and USDCNY below 7.50. EURINR is holding below resistance near 110.30 and needs a breakout for a fresh rally, while USDINR could trade below resistance at 95.50 and see a range of 95.50-95.30/10.

Dollar Index (99.90) looks stable below 100. Although the reading for the index is bullish, a confirmation of a rally will be seen only on a break above 100.30. Till then, the index could range, with immediate downside limited to 99.50.

EURUSD (1.1536) looks stable above 1.15. The near-term trade within 1.1550-1.15 can continue, with maximum near term upside capped at 1.16.

Dollar-Yen (159.43) could see a slow rise towards 160-161. The rise could pick up momentum if the Dollar Index picks up bullish momentum.

EURINR (110.1245) needs to break above 110.30/40 to continue rising towards 111 in the near term. But with the USDINR and EURUSD maintaining stability, EURINR can continue to be ranged for some more time before rising in the medium term.

EURJPY (183.92) is stuck below crucial resistance at 184. A break above 184 is needed for the pair to rise further towards 185/186. However, a sharp rejection from here could lead to a dip to 183/182.

USDCNY (6.7431) continues to trade lower with downside target intact at 6.70.

Aussie (0.7058) and Pound (1.3490) look stable for now. We may expect both currencies to remain stable for a few more sessions before declining towards 0.69 and 1.33 in the medium term.

USDINR (95.43) is likely to trade below 95.50 today. A clear break above this level is needed for a fresh upside rally else, while below 95.50, the pair could dip back towards 95.30/10 in the coming week.

The US Treasury Yields are coming down as expected. The German Yields have also dipped back. Both the US Treasury and the German Yields have good support which can limit the current fall. We expect both the yields to sustain above their support and bounce back to resume their broader uptrend going forward. The 10Yr GoI is coming down within its range. We retain our bearish bias to see a downside break of its range and more fall.

The US 10Yr (4.64%) and 30Yr (5.21%) yields have come down to test their 4.65%-4.6% (10Yr) and 5.2%-5.15% (30Yr) support zone. We expect the yields to rise back from this support zone and keep the broader uptrend intact to see 4.8% (10Yr) and 5.35%-5.4% (30Yr) eventually.

The German 10Yr (3.13%) and 30Yr (3.64%) Yields come down again. That keeps the downside open to test the support at 3.1% (10Yr) and 3.6% (30Yr). The yields can bounce back from this support and resume the uptrend to target 3.3%-3.35% (10Yr) and 3.8% (30Yr) on the upside.

The 10Yr GoI (6.7582%) has come down within its 6.75%-6.8% range. We retain our bearish bias to see a break below 6.75% and fall to 6.7% first and then to 6.6%.

Dow continues to trade within the broad 53000-55000 range with a downside bias towards 53000. DAX remains constructive and can rise towards 27000-27500 on a sustained break above 26500. Nifty is holding above the key 24350-24300 support zone and can recover towards 24500 in the coming weeks. Nikkei remains strongly bullish and can extend its rally towards 70000 and higher. Shanghai has weakened near the 3900 level and can decline further towards 3875-3850 in the near term.

Dow (53978.28, +0.08%) can decline towards 53000 in the near term, while the broad range of 53000-55000 remains intact for some time.

DAX (26499.18, +0.54%) is attempting to break higher and needs a sustained break above 26500 to rise towards 27000-27500 in the near term.

Nifty (24,395.85, -0.16%) recovered well above 24350 after testing a low of 24311 for the day. While the support zone of 24350-24300 holds, it has scope to recover towards 24500 over the coming weeks.

Nikkei (68860.81, -0.48%) can soon move higher towards 70000 and beyond.

Shanghai (3918.58, -0.21%) has declined towards 3900, in line with our caution yesterday, and could fall further towards 3875-3850 in the near term.

Crude prices continues to soften while staying within broad ranges of $ 80-$ 95 for Brent and $ 75-$ 90 for WTI. Gold has corrected after failing to hold above $ 4500, but the broader bullish view remains intact above $ 4200 with scope to rise towards $ 4600 and higher. Silver has weakened in the short term, though the outlook remains positive for a move towards $ 70-$ 75. Copper remains under pressure and can decline further towards $ 6.50-$ 6.45. Natural Gas continues to hold above the key $ 2.60 support and can rise further towards $ 2.80-$ 3.00 in the near term.

Brent ($ 86.95) and WTI ($ 81.19) have fallen further and are likely to remain broadly range-bound between $ 80-$ 95 and $ 75-$ 90 respectively for some time.

Gold ($ 4373.80) has pulled back after failing to sustain above $ 4500. While it remains above $ 4200, the possibility of a break above $ 4500 and a rise towards $ 4600 and higher remains intact.

Silver ($ 64.22) has turned lower, but our view remains intact for a rise towards $ 70-$ 75 in the coming sessions.

Copper ($ 6.57) can decline further towards $ 6.50-$ 6.45 in the coming sessions.

Natural Gas ($ 2.7450) can rise further towards $ 2.80-$ 3.00 in the near term while it holds above the support at $ 2.60.

6:30 12:00 IN WPI
…Expected 10.3 …Previous 10.0

9:00 14:30 EU GDP
…Expected 0.4 % …Previous 0.4 %

9:00 14:30 EU Trade Bal
…Expected -2.2 EURBln …Previous-5.0 EurBln

12:30 18:00 US Retail Sales (MoM)
Expn 0.4 % …Expected 0.1 % …Previous 0.2 %

DATA YESTERDAY:-
—————
UK Trade Bal
Exxp -23.1 GBP (Bln) …Expected -20.3 GBP(Bln) …Previous -21.1 GBP(Bln) …Actual-23.0 GBP(Bln)

UK GDP
…Expected -0.1 % …Previous 0.1 % …Actual 0.6 %

IN Trade bal
Expn. -32.8 $ bln …Previous -30.4 $ bln …Actual-32.0 $ bln

EU Ind Prodn (MoM)
Expn 0.0 % …Expected 0.0 % …Previous 0.5 % …Actual 0.0 %

US PPI
Expn 0.3 % ..Expected 0.2 % …Previous -0.3 % …Actual-0.03 %

US PPI ex Food & Energy (MoM)
…Expected 0.3 …Previous 0.2 …Actual 0.24