Dollar index and Euro holds stable while USDJPY has risen and EURJPY needs to rise above 178 to prevent further decline towards 177/176. EURINR looks bearish towards 105 while below 107. USDCNY needs a break below 6.69 to decline further towards 6.68. USDINR can attempt to test 94.75/50 with some chances of a sharp bounce back from there. We may expect a near term trade of 94.50-95.10 to hold for the very near term. Pound looks ranged while Aussie can slip below 0.69 in the medium term.
Dollar Index (102.065) is stable just above 102. A slow rise back towards 102.50-103 will be needed for the index to hold on to its upward momentum else we may expect it to remain in a consolidation phase around 102 for a few more sessions. Overall view is bullish for the medium term.
EURUSD (1.1211) is holding just above 1.12 and has decent scope to decline below it in the medium term. Overall bearish view remains intact while below 1.13.
Dollar-Yen (158.14) has risen above 158 as expected. A slow rise towards 159 could be possible in the coming sessions.
EURJPY (177.28) looks stable but could decline to 176 while below 178.
EURINR (106.2233) looks bearish towards 105 while it sustains below 107. The trigger to further decline would come below 106. Near term view is bearish.
USDCNY (6.6909) is holding steady above the immediate support at 6.69. A break below this level would open chances of decline towards 6.68. Overall, the view remains bearish.
Aussie (0.6922) has slipped. A break below 0.69 if seen can open fresh downside targets. Else while above 0.69, Aussie can continue to see some sideways consolidation.
Pound (1.3271) has risen well and can rise towards 1.33 or higher in the near term.
USDINR (95.04) closed above 95 yesterday but there is still room for a decline towards 94.75-94.50 on the downside before a rebound takes place. Overall, view is bearish for USDINR while below 95.30.
The US Treasury and the German Yields are coming down in line with our expectation. Both can have some more room to fall. They can test their support and reverse higher to resume their broader uptrend. The 10Yr GoI is holding higher. The outlook remains bullish. The yield can rise more from here.
The US 10Yr (5.09%) and 30Yr (5.42%) yields are coming down towards 5%-4.95% (10Yr) and 5.4% (30Yr) in line with our expectation. After this fall we expect the broader uptrend to resume and target 5.35%-5.4% (10Yr) and 5.7%-5.75% (30Yr).
The German 10Yr (3.41%) and 30Yr (3.77%) Yields have declined further. Support at 3.35% (10Yr) and 3.75% (30Yr) can be tested. After that, a fresh rise can be seen targeting 3.7% (10Yr) and 4%-4.1% (30Yr).
The 10Yr GoI (7.3921%) has risen back well from the low of 7.3459%. While above 7.3%, the outlook remains bullish to see 7.5%.
Global equity markets have largely recovered, with the Dow potentially rising towards 52,500-53,000 and the DAX moving towards 26,000. Nifty needs to sustain above 22,800 to target 23,500, while a failure to hold could trigger a pullback towards 22,600. The Nikkei remains vulnerable to a decline towards 64,000 or lower, whereas Shanghai could rise towards 3,900.
Dow (52183.48, +1.08%) has bounced back towards 52,000, in line with our expectations. A further rise towards 52,500-53,000 could be seen in the near term.
DAX (25668.61, +0.15%) has risen sharply and could move higher towards 26,000 in the coming sessions.
Nifty (22,997.35, +1.66%) has risen well and tested the high of 23,056, as expected, before closing. It needs to sustain above 22,800 to move higher towards 23,500. Otherwise, it could pull back towards 22,600 over the coming week.
Nikkei (65740.30, -4.53%) touched a low of 64,235 and has recovered to current levels. However, it remains vulnerable to a pullback towards 64,000 or lower.
Shanghai (3852.65, -1.30%) has risen above 3,800, as expected, and could move higher towards 3,900 in the near term.
Crude oil prices have risen amid escalating Middle East tensions, with Brent needing to break above $ 108 to rise towards $ 110-$ 112 and WTI potentially moving towards $ 100. Gold needs to hold above $ 4,100 to target $ 4,300-$ 4,400, while silver remains vulnerable below $ 60. Copper could rise towards $ 6.70-$ 6.80 as long as immediate support holds, while natural gas is expected to trade within the $ 3.00-$ 3.50 range.
Brent ($ 105.26) has risen as escalating hostilities in the Middle East disrupt regional energy supplies, supporting crude prices. A break above $ 108 is needed to open the way for a further rise towards $ 110-$ 112. Otherwise, a range of $ 100-$ 108 could prevail for some time.
WTI ($ 95.81) has risen sharply and could rise further towards $ 100 in the coming sessions. The $ 90-$ 100 range remains intact for now.
Gold ($ 4178.70) needs to hold above the support near $ 4100 to keep alive the possibility of a rise towards $ 4300-$ 4400. Otherwise, it risks falling further towards $ 4000-$ 3900.
Silver ($ 57.20) has bounced back, but as long as it remains below $ 60, it remains vulnerable to a fall towards $ 52-$ 50.
Copper ($ 6.59) has bounced back from immediate support. As long as this support holds, a further rise towards $ 6.70-$ 6.80 could be seen.
Natural Gas ($ 3.2060) could trade within a range of $ 3.00-$ 3.50 for some time.
9:00 14:30 EU CPI (YoY)
Expn. 3.6 % …Expected 3.8 % …Previous 3.3 %
9:00 14:30 EU Trade Bal
…Expected 4.5 Eurbln …Previous 5.0 Eur bln
–
13:15 18:45 US Industrial Production
Expn. -0.1 % …Expected 0.4 % …Previous 0.1 %
13:15 18:45 US Capacity Utilization
Expn. 75.9 % …Expected 76.5 % …Previous 76.3 %
20:00 01:30 US TICS (Net foreign purch of long-term Sec)
…Expeccted 125.7 $ bln …Previous -27.9 $ bln
DATA YESTERDAY:-
—————-
Australia Labour Force
…Expected20.0 K …Previous 29.3 K …Actual -39.3 K
UK Trade Bal
…Expected -21.8 GBPbln …Previous -19.3 GBP bln Expn.-18.2 GBP bln …Actual-18.0 GBP bln
EU Ind Prodn (MoM)
…Expected 0.1% …Previous -0.3 % Expn. 0.0 % …Actual-0.1 %
IN Trade bal
Expn -36.7 $ bln …Previous -26.9 $ bln …Actual-34.4$ bln –
US PPI
Expnn 0.3 % …Expected 0.6 % …Previous 0.5 % …Actual 1.3%
US PPI ex Food & Energy (MoM)
Expn. 0.2 …Expected 0.3 …Previous 0.2 …Actual-0.7
US Retail Sales (MoM)
Expn 0.3 % …Expected 0.3 % …Previous1.3 % …Actual 0.8% –
US Philifed Index
Expn. -99.4 …Expected28.2 …Previous37.8 …Actual 20.9
