STOCKS
Indian indices, the Sensex and Nifty 50 remains strong and continue to outperform their global peers. They are likely to move further higher in the coming days. On the global front, Nikkei and DAX are bullish and can move higher in the near term. Dow can also move up if it can hold on to last week’s gains. Shanghai can consolidate sideways for some time within its overall uptrend
Dow (25,848, +138.93, +0.54%), on Friday has closed above the 21-day moving average(25,800) which was capping the upside for some time. If it manages to sustain above 25,800, an upmove to 26,100 and 26,200 can be seen in the near term. The index will come under pressure for a fall to 25,200 and 25,100 only if it declines below the support level of 25,685
DAX (11,685.69 +98.22, +0.85%) has broken above 11,650 as expected and keeps the bullish outlook intact for a test of 11,800.
Nikkei (21,579.66, +128.81, +0.60%) has been holding well above its 100-day moving average support level of 21,286. The index can target 22,000 in the coming days on a strong break above 21,600
Shanghai (3,049.82, +28.07, +0.93%) can consolidate between 2,950 and 3,100.
Sensex (38,024.32, +269.43, +0.71%) and Nifty 50 (11,426.85, +83.60, +0.74%) have closed on a strong note last week. The indices remain bullish. Sensex has supports at 37,875 and 37,620 and Nifty has supports at 11,320 and 11,225. While above these supports, Sensex can target 38,500 and 39,000 and Nifty can target 11,600 and 11,750 in the coming weeks.
COMMODITIES
Gold, Silver and Copper looks mixed and may consolidate in the near term before a clear trend emerges. Oil might dip in the near-term and may reverse higher thereafter.
Gold (1299) can dip to 1290 in the near-term and may remain range bound between 1290 and 1310 for some time.
Silver (15.27) looks mixed with equal chances of either rising to test the resistance at 15.4 or declining to test the support at 15.10 from current levels.
Copper (2.91) has been consolidating sideways between 2.88 and 2.95 over the last couple of week. It is likely to retain this range for some more time. The bias is bullish for the prices to breakout above 2.95 and target 2.98 and 3.0 in the coming weeks.
WTI (58.25) sustains above 58 but seems to be lacking fresh follow-through buyers. A dip to 57-56.85 looks likely in the near term before we see a rally to 60.
Brent (67) failed to breach 68 last week and fell sharply on Friday to test 66. The broader 64-68 sideways range remains intact. Within this range, Brent may remain stuck between 66 and 68 in the near term. We see high chances of Brent breaking above 68 and target 70 in the coming days.
FOREX
Dollar-Index (96.52) could bounce from 96.25 and gradually rise towards 97.00 and higher in the near term. While 96.25 holds, Dollar Index looks bullish.
As mentioned on Friday, Euro (1.1332) is likely to test immediate resistance near 1.1350 or higher at 1.14 from where a fall is likely to be seen in the coming sessions towards 1.1250-1.1200. Medium term looks bearish.
Euro-Yen (126.49) has been stable, trading just below important resistance near 126.80. A corrective dip from there looks likely.
Dollar Yen (111.61) has immediate resistance near 112.50 and could be headed higher in the next few sessions. A short corrective dip from there could be expected.
Aussie (0.7096) could test 21-D MA near 0.7123 which if holds could push it back to 0.7050 in the near term. A break above 0.7123 could see an extension towards 0.7150-0.72 on the upside.
Pound (1.3289) is holding trading within 1.32-1.34 region and could possibly spend some more time within this region. In the medium term a gradual fall towards 1.3050 is possible if the Pound breaks below 1.32. Note 1.34 is an important resistance that may hold for now.
USDCNY (6.7139) has trend support near 6.70 as seen on the 3-day chart and while that holds, the pair is likely to move up towards 6.74 or higher.
Dollar-Rupee (69.10) is likely to come down further today towards our mentioned levels of 68.90/80. Near term looks strong for the Rupee.
INTEREST RATES
The US yields have risen. The 2YR (2.45%), 5Yr (2.40%), 10Yr (2.60%) and the 30YR (3.02%) have risen by 1bps. The bounce if continues in the near term could take the yields higher as there is enough room on the upside towards 2.67% (for 10Yr ), 3.10% (for 30YR), 2.5% (for 5YR).
The US-JGB 10YR (2.63%) is trading near support levels and could bounce back in the near term targeting higher levels of 2.70%. Near term looks bullish and while the spread rises, it could pull up Dollar-Yen too in the near term.
The 10YR GOI (7.5024%) closed at lower levels on Friday contrary to our expectation of a rise towards 7.60%. While below 7.54%, lower levels of 7.48/45% come into the picture again. While the yield looks bearish towards 7.45%, Rupee could see some more strength in the near term.
