STOCKS
Dow (21580.07, -0.15%) bounced back sharply from 21500 but could be trading in the 21500-21750 region for a few more sessions before deciding its further direction. While support near 21500 holds, near term looks bullish.
Dax (12240.06, -1.66%) broke below 12400 to test our initial targets of 12300-12200. Bears look more powerful just now and could push the index towards 12000-11870 levels soon.
Shanghai (3252.69, +0.45%) has been rising as expected and may test resistance near 3270 from where a small dip is possible towards 3220 or lower in the near term. A break above 3270, if seen could take the index to levels near 3280-3295 which is an important resistance to keep an eye on.
Nikkei (19927.29, -0.86%) has broken below the immediate channel support and if that sustains, we could see a fall towards 19800-19700 levels in the near term. While Dollar-Yen continues to fall towards 110 or lower, Nikkei could also see fresh dips in the near term.
Nifty (9915.25, +0.42%) is likely to move higher towards 10000-10050 levels soon limiting its downside to 9800 just now. Near term looks bullish.
COMMODITIES
Ahead of the OPEC meet in Russia today, both Brent (48.21) and WTI (45.86) have corrected sharply as they test their respective supports of 48 and 46. The upside chances still remain open as long as Brent trades above 48.00-47.65 and WTI trades above 46.00-45.50.
Gold (1254) broke above the resistance of 1245 to register a high of 1257 this morning but it may find it difficult to rise above the resistance of 1260 on the very first attempt. Silver (16.4560) made an unsuccessful attempt to stay above the resistance of 16.50 but the failure to sustain the higher levels may keep it in the range of 16.20-16.50 for a few sessions more.
Copper (2.725) remains muted and rangebound in 2.66-78. While the resistance of 2.78-80 may not be overcome right now, it may keep trading sideways in the range of 2.55-80 for the next few days.
FOREX
OPEC meet today and Fed meet on Wednesday, 26th Jul’17 are going to set the market mood this week.
Euro (1.1670) is trading close to the final horizontal resistance of 1.1712 and there are equal chances of rising above it or failure near 1.17. At this point, we wait and watch. Naturally, Dollar Index (93.92) remains very weak and the downside target of 93.00 remains unchanged.
On the other hand, Dollar Yen (110.96) has already achieved our downside target of 111.00 and a minor recovery is visible from 110.73. As discussed last week, a strong bounce is a possibility from the 111.00-110.50 region and that warrants caution for the bears at the current levels.
Aussie (0.7921) is in a pause mode as expected and it may trade sideways in the range of 78.50-80.00 for a couple of sessions more before attempting a fresh high above 0.80.
Dollar-Rupee (64.32) has closed below 64.35 for the first time in the last 6 weeks. The charts themselves suggest greater chances of further downside towards 64.10 in case the immediate Support at 64.28 breaks. Whether further decline below 64.10 is seen or not might be dependent on the Euro breaking above 1.1713. We need to wait and watch on that.
INTEREST RATES
The US yields could come down a little more before rising again. The 30YR (2.81%) could come off towards 2.75% before pausing to see a corrective upmove. The 10YR (2.23%) and the 5Yr (1.80%) also have some room on the downside towards 2.18% and 1.70% respectively.
The US-Japan 10YR (2.16%) yield spread has fallen sharply and is testing immediate support just below current levels. If the support holds, the spread could bounce back in the next couple of sessions and could pull up Nikkei and Dollar Yen with itself.
The UK yields are also trading low and could move down in the near term. the 10Yr (1.17%), and the 20Yr (1.71%) could test 1.10% and 1.62% respectively. Near term looks bearish.
The Japanese yields are trading just above immediate supports and could bounce back in the coming sessions. Near term looks bullish.
