STOCKS
Most of the stock indices are looking bullish for the coming week.
Dow (21144.18, +0.65%) has risen sharply and has come up to re-test previous high of 21170, also an important near term resistance. A break on the upside is needed to turn further bullish in the near to medium term.
Immediate support is seen near 12600 on Dax (12664.92, +0.40%). While that holds, a rise towards 12800 seems possible in the coming sessions.
Shanghai (3088.54, -0.45%) is trading lower and could test levels near 3050 before again bouncing back towards 3100-3150 over the next week. Overall ranged movement in the 3050-3150 region is possible in the next couple of weeks.
Nikkei (20139.31, +1.41%) has moved up sharply breaking above the 20000 resistance and while the rise sustains there is scope of rising towards 20500-21000 in the coming sessions. Near term looks bullish.
Nifty (9616.10, -0.05%) closed a little lower yesterday. We could possibly see a rise back towards 9650-9660 today. A small dip towards 9500 is possible next week before it resumes its upward rally towards 9700-9800.
COMMODITIES
Gold (1262.97) is struggling near the resistance zone of 1275-85 but the bears need a break below 1255-50 to confirm a fresh decline towards 1230 levels.
Silver (17.20) resolved the contraction phase to the downside but the support of 17.00 is holding so far. Similar to Gold, Silver requires a break below this immediate support of 17.00 for a confirmation of the downtrend.
Copper (2.57) has been consolidating in the range of 2.55-60 for the last few sessions. As discussed previously, it remains bearish below the short term channel resistance near 2.62/65 and the chances of a decline to 2.45-40 remains open but it could be prudent to be prepared for a sudden turnaround to the upside in the medium term.
Brent (50.41) is yet to show our expected recovery as it wanders just above our target/support of 50.00. A break below 50.00 may negate the chances of an immediate recovery and open up further downside towards 48.30. In that case, WTI (48.12) may test 47.00 to the downside and even lower levels below 46 may be on the cards.
FOREX
Dollar Index (97.21) has recovered some of the losses made in the previous 2 sessions on the back of better than expected American private hiring data but the resistance of 97.40-50 may limit the bounce after the US Job data release tonight.
Euro (1.1217) is in a minor pause after the sharp rally earlier in the week and may resume the uptrend soon for 1.1300.
Dollar Yen (111.61) is rising towards the higher end of its near term range of 110-112 but the resistance near 112.00 is expected to hold for the week. Repeat, it’s better to wait for a breakout as any attempt to gauge any directional clue from these oscillations may turn out to be deceiving.
As discussed yesterday, the chance of a prolonged phase of sideways consolidation of Pound (1.2874) in the broader range of 1.2750-1.3000 is strengthening every day and this phase may well extend to the next week.
Aussie (0.7386) remains weak and a failure to end the week above 0.74 may push it down to 0.7325 next week.
Dollar Rupee (64.50) to remain within 64.40-64.60 this week. A break on either side is needed to get some directional clarity.
INTEREST RATES
The US yields are mixed. The shorter term yields of 2YR and 5Yr are trading slightly higher today while the longer term 10YR (2.22%) and the 30Yr (2.87%) yields are stable.
The UK-US 10YR (2.16%) is headed lower and has enough scope on the downside. We could possible see a short bounce from 2.0% in the next week.
The UK yields have bounced back from immediate support levels as expected and could now move up in the coming sessions. The 5Yr (0.507%), 10YR (1.061%) and the 20YR (1.618%) are trading higher today.
The Japan yields have risen but could remain ranged in the near term. The 10Yr (0.06%) has risen the most among the other tenure yields and could be headed towards 0.08-0.10% in the near term.
