Stocks
Global indices have little room on the downside with supports coming up. While the supports hold, we could see a bounce in the coming weeks.
24250-24200 is the immediate support zone on the Dow (24464.69, -0.0039%). A bounce would take the index back towards 25500-26000 or even higher in the longer run.
While above 11000, a bounce could take Dax (11244.17, +1.61%) higher towards daily resistance near 11300. A break below 11000 would open up 10800 on the downside.
The Nikkei (21491.56, -0.074%) is trading lower today. A fall towards support at 21200 looks likely on the 3-day candles. Only on a break below 21200, if seen would we consider lower levels of 21000 to be tested. For now, we expect a bounce from 21200.
Shanghai (2646.73, -0.18%) is almost stable and is trading just below resistance at 2700. While above 2600, there could be scope of breaking above 2700 and heading higher in the medium term. Down channel is intact on the 3-day candles and indicates a fall towards 2550 or lower.
Resistances near 10800 and 36000 have held on Nifty (10600.05, -0.53%) and Sensex (35199.80, -0.77%) respectively. Immediate support is seen near 35000 which if holds could bring a bounce back towards 36000; else a fall towards 34500 or lower is possible. Nifty if breaks below 10600 and sustains, it could fall towards 10400. The indices look bearish for the near term.
COMMODITIES
News: OPEC is due to meet with major producers in Vienna next month, with Saudi Arabia proposing at least a 1mln barrel/day cut to stabilize prices.
Brent (63.24) and WTI (54.39) have fallen sharply breaking below our expected immediate supports near 65 and 55 respectively. We now look at crucial support at 62 on Brent and 51 on WTI to initiate a bounce and take the crude prices to higher levels gradually. Near term looks bearish towards respective support levels from where a bounce is expected soon.
Gold (1227.80) is holding below 1230 just now. A break above 1230 is needed to take it higher towards 1250. Watch price action near 1230 as a rejection from here, if strong could push it back towards 1210.
Copper (2.7860) is likely to hold below resistance zone of 2.85-2.80. A dip to 2.65 could be seen while below 2.85.
FOREX
Chances for Euro, Pound and Aussie to strengthen towards 1.145, 1.285 and 0.73 by early next week. Consequently, Rupee could also trade closer to 71.20.
Dollar Index (96.63) might just fall towards support on daily candles near 96.30 in the next 2-3 sessions and then rise from there again in the next week.
Euro (1.1398) came off after testing resistance (earlier support) on 3 day candles near 1.1472 and now has support near 1.137-1.138 (21 days MA). A break above 1.1405 could lead to an upmove to 1.145 while a break below 1.137 would lead towards 1.13-1.12. Looking at the Dollar Index, slight preference is for a break of 1.1405 towards 1.145.
Dollar Yen (112.98) might have resistance between 113.0-113.4 on daily candles, from where it might come off and resume its fall towards support near 112.25 in the next week. A break above 113.4 might negate the immediate fall towards 112.25.
Pound (1.2784) has immediate resistance on daily candles near 1.278-1.280, a break of which might take it towards higher resistance near 1.285-1.290 early next week. However, ultimately, it should again become bearish towards crucial support at 1.27.
Aussie (0.7252) : While it stays above support near 0.7225, it should again see a rise towards 0.730-0.734 by early next week. Alternatively, a break below 0.7225 would open up chances of a test of lower support near 0.720-0.717 by early next week. The bullish alternative is more preferred currently.
Euro Yen (128.78) has immediate resistance at 129.0-129.1 on daily candles which should push it down towards 127.5 over the next couple of weeks. Alternatively, a break above 129 would open up chances of a test of 130 early next week.
Dollar Rupee (Onshore Closing on 20th Nov: 71.455): Fall in Brent might just impart some strength to the Rupee making it trade close to 71.20. We broadly see a near-term range of 71.20-80 till early next week. Resolution of this range will set the trend for December. Two-way possibility for the medium term.
INTEREST RATES
US 10 Year yield (3.06%) : Chances of testing 3% has increased as the US 10 year seems to be struggling to rise back towards 3.10%. Crucial to see if this 3% support holds in the coming couple of weeks or not – since a break below 3% might keep US yields stable to bearish in the next 1-2 months. If 3% breaks, the next target would be lower support near 2.9%.
German 10 year yield (0.38%): Although there has been a slight rise in the German 10 year, preference is still tilted towards a possible downmove towards support near 0.30% in the near term, before an eventual rise from there back towards 0.5%.
The German-US 10 Year yield spread (-2.68%) might just break crucial resistance near -2.70% if the US 10 year breaks below 3%. The German-US 2 year spread (-3.39%) is almost breaking above the -3.40% resistance. A break of -2.70% by the 10 year spread and a break of -3.40% by the 2 year spread would both be significant and might point towards stability/bearishness in US yields in the near to medium term.
Japanese 10 year yield (0.10%) is testing crucial support at 0.10% and should see a bounce from here.
