STOCKS
Equities are mixed. While Dow has recovered the previous day’s fall along with a rise seen in shanghai, Nifty and Sensex. Dax and Nikkei have declined sharply but could soon recover to rise back while supports hold.
Dow (34639.79, +617.75, +1.82%) has bounced back sharply from 34000, almost recovering the losses seen in the previous session. The view is bullish to see a rise towards 35000/35500 while above 34500/600.
DAX (15263.11, -209.56, -1.35%) has fallen. The view is still bullish to see a rise towards 15900 while the index holds above 15100.
Nikkei (27692.34, -61.03, -0.22%) has come down slightly today. A fall towards 27000 is possible before we see a bounce from there.
Shanghai (3583.36, +9.53, +0.27%) has broken the interim resistances at 3575 and is now slowly headed towards 3600. A strong break above 3600 is needed to see 3650/3700 in the medium term. Else a pullback towards 3500 is possible from 3600.
Nifty (17401.65, +234.75, +1.37%) rose sharply yesterday and closed above 17400. A rise towards 17600/800 can be seen while above 17400 that can negate the bearish view of seeing a fall towards 17000 and 16800 on the downside again. Watch price action near 17400.
Sensex (58461.29, +776.50, +1.35%) has broken the resistance at 58000 and has closed at 58461.29. The view is bullish to see a rise towards 59000/59500 in the coming sessions.
COMMODITIES
Brent and WTI fell sharply towards 65 and 61 after OPEC+ decided to hike production by 400,000 barrels per day in Jan’22. However, the crude prices recovered the fall seen yesterday and while above immediate supports at 64/65 (brent ) and (WTI), the prices can rise in the very near term. Gold is falling on a stronger US Dollar. If it breaks below 1770, it can fall to 1760/40. Silver is ranged within 22-24. Copper is bullish towards 6.45/50/60 while above 4.20/25.
Brent (70.39) is holding above 64/65 and WTI (67.28) is holding above 61. There can be some short upmove for the near term before a fall is seen in the longer run towards the mentioned support levels.
Gold (1773.20) is testing the lower end of the 1770-1820 range and needs to bounce back in order to move up further. But while the Dollar Index trades high, Gold can come off below 1770 towards 1760/40 on the downside. Watch price action near 1770 today.
Silver (22.35) is likely to remain ranged within 22-24 region for now.
Copper (4.2830) has risen slightly from lower levels seen yesterday. The price needs to bounce from 4.20/25 to hold higher and head towards 4.45/50/60 eventually on the upside.
FOREX
Dollar Index has bounced again to levels above 6 and if it sustains above support near 95.50, there is scope for a rise towards 97-98 eventually. Euro is falling towards 1.12. Aussie is strongly bearish towards 0.70-0.6950 while Pound is also set to fall towards 1.32-1.3190. EURJPY has broken below 128 and if it sustains, it can fall towards 125 on the downside in the medium term. Dollar Yen may trade within 112-114 while USDCNY is bearish while below 6.43/40. USDINR is likely to be ranged within 74.60/80-75.20/25 for now.
Dollar Index (96.1750) is holding above 95.50 over the past few sessions and has scope to rise back towards 97 or higher with mild interim corrective dips. Overall broadly a rise towards 97.50-98 is still on the cards before a reversal is seen.
Euro (1.1295) is holding below 1.14-1.1380 and has been falling over the past 3-sessions. We may look for a fall towards 1.1250-1.12 again in the next few sessions.
EURJPY (127.76) has again broken below 127. As warned earlier, continuous attempts to break below 128 may eventually give way a trigger a fall towards 125 on the downside. An immediate pull back from current levels is needed for EURJPY to rise back. A rise above 128.50, if seen and sustained can again take the cross towards 129-130. Else bearishness looks more prominent just now.
Aussie (0.7068) continues its fall and is expected to decline further towards 0.70-0.6950. View is strongly bearish.
Pound (1.3287) has broken below 1.33 and if it manages to break 1.3267/60 it can fall further towards 1.32-1.3190. View is bearish while below 1.33.
Dollar-Yen (113.11) tested 112.65 yesterday but has again risen back from there. A possible sideways range of 112.50-114 (revised from 113-114) may hold for the next few sessions.
USDCNY (6.3743) tested 6.3770 after bouncing from 6.3596 over the past 2-days. While below 6.40/43, view remains bearish and if the pair manages to sustain trade below 6.37, it will confirm a possible fall towards 6.36/35 soon.
{USDINR (75.00) traded within 74.88-75.07 yesterday. We continue to expect a narrow range of 75.15-74.80 and a broad range of 75.20/25-74.60 to hold for now before a break on either side of the range is seen.
INTEREST RATES
The US Treasury yields at the far-end (10Yr and 30Yr) continue to remain lower and stable above their crucial supports. The price action in the coming days will need a close watch to see if they can bounce-back and keep the broader sideways range intact. The US jobs data today will need close watch to see what does it have on plate for the yields. The German yields remain lower and keep our bearish view intact of seeing a further fall from here. The 10Yr and 5Yr GoI remain stable within their expected narrow sideways range. A rise to test the upper end of their range is possible in the near-term.
The US 2Yr (0.60%) and the 5Yr (1.19%) have inched up slightly while the 10Yr (1.43%) and the 30Yr (1.75%) remain lower and stable. We reiterate that 1.4%-1.35% on the 10Yr and 1.75%-1.70% (changed from 1.75% mentioned yesterday) on the 30Yr are crucial supports. A bounce from here will keep the broader 1.35%-1.75% (10Yr) and 1.75%-2.1%/2.2% (30Yr) range intact. On the other hand, a break below these supports will be very bearish. It is a wait and watch for now.
The German 2Yr (-0.76%), 5Yr (-0.64%), 10Yr (-0.37%) and 30Yr (-0.07%) have dipped across tenors and are keeping our bearish view intact. We expect to see a fall to -0.45% / -0.5% on the 10Yr and -0.1% / -0.2% on the 30Yr.
The Indian 10Yr (6.3520%) and the 5Yr (5.6810%) remained stable yesterday. The 6.3%-6.38% range on the 10Yr and 5.62%-5.7% range on the 5Yr is intact. A rise to the upper end of these ranges is possible in the near-term before a reversal is seen.
