STOCKS
Almost all stocks have risen and are trading higher. Important resistance on Nifty and Shanghai is seen above current levels. Dax and Nikkei have some more room on the upside.
Dow (20172.40, +0.59%) has moved up towards 20200 but there could be some pause either near 20200 or at higher levels of 20300-20350 region which could keep the index in a consolidative mode for some sessions in the last few sessions next week.
Dax (11642.86, +0.86%) has also moved up along with the other indices. A break above 11680 could take it higher towards 11820-11930 levels in the medium term. Overall view remains bullish while above 11400.
Nikkei (19343.64, +2.31%) moved up sharply as Dollar-Yen (113.67) shot up breaking the 111.36-112.60 range mentioned yesterday. With fresh rise in the Dollar Index boosting weakness in the Japanese Yen, we could see a rise in Nikkei too in the near term. Immediate target on the upside would be 19615 over the next few sessions.
Shanghai (3193.58, +0.33%) is on the verge of breaking above the important resistance near 3200. If this breaks on the upside, we could target for levels near 3300-3400 levels in the next couple of weeks.
Nifty (8778.40, +0.11%) could continue rising towards 8800-8850 levels before pausing shortly. 9000 is a crucial resistance we are looking at for the medium term which may not easily break on the upside.
COMMODITIES
Dollar (100.67) strength is hurting precious metals but Crude remains stable.
Gold (1225.04) has corrected to the significant support of 1220 after making a high at 1245, in the middle of the resistance band of 1240-50. If 1220 holds, then another bounce to 1250 may emerge but a break below 1220 may extend the decline to 1205-1200. Wait and watch.
Silver (17.59) has weakened and may test the major support near 17.38-35 which must hold to keep the upside possibilities open. The uptrend remains intact above 17.35 but a break below 17.35 can drag it down to 17.10-00 levels.
Brent (55.67) has retraced half of it recent fall from 57.41 to 54.41 and WTI (53.08) has retraced more than 60% of the fall from 54.34 to 51.38. The sentiment in the immediate term has turned bullish but the IEC and OPEC reports due today and Monday respectively may determine the near term path.
Copper (2.654) is unchanged in the range of 2.61-2.70 as expected, which may continue for a few days more.
FOREX
A Trump promise to overhaul business taxes in a big way in the next 2-3 weeks has boosted the Dollar. Rupee is still more driven by domestic factors more than the global ones.
Dollar Index (100.67) is trading at the current week high and may test the resistance of 100.75-101.00 soon. A break above 101.00 may give the impetus to rise higher towards 101.70-102.00 by the next week but a failure near 101.00 can keep it in the range of 100.00-101.00 for a few sessions more.
Euro (1.0658) is testing the immediate support of 1.0650 once again and if Dollar manages to break above 101.00, then it can slide down to 1.0570 or even lower instead of the expected consolidation in 1.0650-1.0800.
Dollar-Yen (113.66) has rallied above the major resistance of 113.50-60 exactly as expected and if it manages to sustain above 113.50, then it may appreciate further to 115-116.
Pound (1.2513) is almost unchanged as it continues to trade horizontally in the range of 1.2350-1.2700 without any directional bias in the near term.
Aussie (0.7644) is stuck in the contracting range of 0.7600-0.7680 for the last 4 sessions but an upside breakout looks more likely which may take it to the resistance of 0.7725-50, where the bears may return again and push the price down.
Dollar Rupee (66.85) has closed below the support of 66.90 yesterday and if it doesn’t bounce from 66.80 today, then we may have to abandon our near term bullish view and consider lower levels of 66.50-35.
INTEREST RATES
The German-US 2YR (-1.98%) and the German-US 10Yr (-2.11%) are falling off from resistance levels indicating a fall in the Euro in the near term. The 2YR differential may head towards -2% to -2.05% while the 10YR differential may test -2.15% in the near term.
Near term trend line supports have held well helping the US yields to bounce back. The 5YR (1.89%), 10YR (2.42%) and the 30YR (3.02%) have risen slightly and could rise for a couple of sessions more before pausing. Overall in the medium term a deeper fall in the US yields is expected.
The 10Yr GOI (7.0145%) has risen above 7% and could rise further today. This has been a sharp vertical rise which could possibly extend towards immediate resistance near 7.10%. Thereafter a small dip can be expected.
