Dow continues to remain mixed and continues to oscillate around 34000. It has to get a strong follow-through rise from here to avoid a fall below 33500. DAX has dipped below 15200 and can come under pressure if it falls below 15000. Nikkei has dipped below 29000 and can go down towards the lower end of its 28000-31000 range. Shanghai can also move down within its 3350-3500 range. Sensex and Nifty have key resistances ahead which will have to be broken in order to move up further. Inability to break their resistances can drag the indices lower in the coming days.
Dow (34060.36, +239.98, +0.71%) has risen back above 34000. But it has to get a strong follow-through rise from here to move up towards 35000 and also reduce the danger of falling below 33500-33000 towards 32000-31000 that we have been cautioning for some time.
DAX (15154.20, ?137.98, -0.90%) has dipped below 15200. A further fall from here and a break below 15000 can trigger the expected fall to 14500-14000 from here itself and will negate the chances of seeing 15500-15700 on the upside.
Nikkei (28917.87, ?136.10, -0.47%) has dipped below 29000. While it remains below 29000, a fall to 28500-28000 can be seen in the coming days. Overall, as we have been mentioning, Nikkei can oscillate in the range of 28500-30500 (narrow) or 28000-31000 (broad) for some time and a breakout of the range will give clarity.
Shanghai (3 453.51, ?21.40, -0.62%) has dipped today after having risen over the last couple of days. The 3350-3500 range remains intact. While below 3500, we expect a fall to 3400-3350 in the coming days.
Nifty (14894.90, +30.35, +0.20%) has come-off yesterday after testing 15000. Key resistance is in the 15150-15200 region which will have to be broken to move up further. While below 15200, a pull-back to 14700-14600 cannot be ruled out in the coming days.
Sensex (49765.94, +32.10, +0.06%) has come-off from just below 50500 yesterday. Inability to rise past 50500 can drag it to 49000-48500 again.
Commodities have recovered the movement seen yesterday. Gold and Silver trade lower but needs to sustain above 1760 and 26 in order to move up again else a fall to 1740-1720 and 25 cannot be negated. Copper may test 4.40 before again rising back to higher levels. Crude prices may face rejection above current levels and could fall back in the medium term.
Brent (67.68) and WTI (64.56) remain stable and we reiterate that the prices can face rejection from 68-70 on Brent and 65-67 on WTI respectively. The rejection could bring back prices down in the next few sessions. View is bearish while respective resistances hold.
Gold (1767.60) has fallen and could re-test 1760. Failure to bounce from 1760 could make it vulnerable to a fall towards 1740-1720 again in the medium term. For it to head towards 1800 again, a bounce from 1760 is necessary.
Silver (26.00) has dipped slightly but if it does not manage to bounce back from here, we may not be able to rule out a possible fall towards 25 in the medium term. Watch price action at 26.
Copper (4.4820) fell from levels seen yesterday. We may expect 4.60 to hold for a few sessions at least while Copper trades sideways within 4.60-4.40 before again attempting to rise sharply.
Dollar Index has bounced slightly but while below 91, the view is bearish for the longer run. Euro may trade within 1.2150-1.2090 before rising again. EURJPY and Aussie see short corrective dip towards 131.50 and 0.77 but thereafter the trend remains higher to target 135 and 0.78-0.79 in the longer run. Pound may slowly rise and attempt to break above 1.40. USDCNY needs to bounce from 6.46 to prevent a fall to 6.44. USDINR may rise to 74.20/30 before falling towards 73.80.
Dollar Index (90.636) bounced back from 90.42, unable to sustain below 90.50. While the support near 90.50/40 holds just now, we may expect a rise to 90.85-91.00 before again resuming the fall towards 90 or lower in the longer run.
Euro (1.2118) dipped from 1.2150 but the decline is likely to be limited to 1.2090 for the near term before the Euro again starts to rise. Watch price action near 1.2090.
EURJPY (131.82) tested 132.37 yesterday before slightly falling from there. The trend continues to point to the upside. A brief fall to 131.5 could be possible before the cross rises sharply towards 135 in the longer run.
Dollar-Yen (108.78) is holding below 109 for now and could trade sideways within 109-108.50 for sometime before again starting to fall towards 108 and lower. While below 109.25-109.00, view is bearish for the longer run.
Aussie (0.7771) has also come down from 0.7818 but while above 0.77, there is still scope for a sharp rally towards 0.79 in the medium term. The sideways range below 0.78 may not last long.
Pound (1.3947) has been rising slowly. A break above 1.40 is needed for the pair to turn bullish and rise further towards 1.41-1.42 in the longer run. For now watch a rise to 1.40 to see if it manages to break above or faces rejection from there.
USDCNY (6.4677) has dipped a bit and could test 6.46 before bouncing higher from there. Failure to hold above 6.46 could take it down towards 6.44 in the medium to long term.
USDINR (74.0450) fell sharply as expected to test 73.9625 before bouncing back from there to close at 74.0450. We may expect scope for a fall towards 73.80 on the downside in the coming sessions but before that a corrective bounce could be seen today towards 74.20-74.30 on the upside.
The US Treasury yields have moved up across tenors. The turn-around over the last few days from near the crucial support levels that we had mentioned is giving an early indication of the resumption of the overall uptrend. The price action in the coming days will need a close watch to confirm the same. The German Yields are poised at their crucial resistance. It will have to be seen if they can break above these resistances or not. The 10Yr GoI remains stable. Our broader view continues to remain bearish.
The US 2Yr (0.16%) and 5Yr (0.87%), 10Yr (1.65%) and 30Yr (2.31%) have moved up further across tenors. The move over the last few days indicates the resumption of the overall uptrend. A further rise from here can take the yields back to 1.8% (10Yr) and 2.5% (30Yr) in the coming weeks. The danger of the yields breaking below their crucial support levels of 1.5% (10Yr) and 2.2% (30Yr) stands reduced now.
The German 2Yr (-0.69%), 5Yr (-0.56), 10Yr (-0.19%) and the 30Yr (0.35%) yields have moved up and are poised at their crucial resistances. The 10Yr has to sustain above -0.20% to move up further towards 0% in the coming weeks. Else a fall back to -0.35% is possible. The 30Yr has to break above 0.35% to move further higher and become more bullish.
The 10Yr GoI (6.0591%) continues to remain stable. Our broader view continues to remain bearish to see 6% in the short-term and 5.9% over the medium-term. 6.08% is the immediate resistance and 6.10%-6.12% are the higher ones that can cap the upside from here.
23:30 5:00 JP Unemp
Expn 3.16% …Expected 2.9% …Previous 2.9%
1:30 7:00 AU PPI
…Expected 0.3% …Previous 0.5%
9:00 14:30 EU GDP
…Expected -0.8% …Previous -0.7%
9:00 14:30 EU Unemp
Expn 8.00% …Expected 8.3% …Previous 8.3%
12:30 18:00 US Personal Income
Expn -2.05% …Expected 20.1% …Previous -7.1%
12:30 18:00 US PCE Price Index M/M
Expn -0.24% …Expected 0.3% …Previous 0.1%
12:30 18:00 CA GDP
9:00 14:30 EU Biz Climate
Expn 110.74 …Expected 103.0 …Previous 100.9 …Actual 110.3
12:30 18:00 US GDP
…Expected 6.5% …Previous 4.3% …Actual 6.4%