STOCKS
Most indices have fallen globally. Dow can test 35250-35000 while Dax can test 15300-15200/100 before bouncing back in the medium term. Nikkei and shanghai have fallen too and can test 27750 and 3600 respectively in the near term. Sensex can test 58000 and bounce from there else can fall to deeper levels of 57000. Nifty is likely to be stuck within 17000-17800 for now. Overall indices look weak for the next few sessions.
Dow (35544.18, -106.77, -0.30%) has come down sharply again from 36000 contrary to our expectation of a rise towards 36500-36750 on the upside. The view is bearish while below 36000 to see a fall towards 35250-35000 before we see a bounce again.
DAX (15453.56, -168.16, -1.08%) has declined sharply from 15800, falling below the range of 15500-15800. If the fall sustains, we may expect a further fall towards 15300-15200/100 on the downside before a bounce is seen.
Nikkei (28409.40, -23.24, -0.082%) has come down below 28500. The view is now bearish towards trend support near 27750 before we see a bounce from there towards 28500 again.
Shanghai (3661.31, -0.22, -0.0060%) is heading towards 3600 slowly. While below 3700 a fall towards 3625-3600 looks possible.
Nifty (17324.90, -43.35, -0.25%) saw an intraday high of 17376.20 before coming down to close around 17300. View is bearish to see a fall towards 17200/17000 before we see rise again. Broad range of 17000-17800 might hold for the next couple of weeks.
Sensex (58117.09, -166.33, -0.29%) has come down further yesterday. A range of 58000-59000 is possible while above 58000. A sharp break below 58000, if seen can take the index down towards 57000 before the expected bounce is seen.
COMMODITIES
Crude prices trade lower but have immediate supports to bounce from which if fails can lead to further fall in the near term. We need to keep a close watch at current levels. Gold seems to be slowly inching lower but can be bullish while above 1770/60. A break on the downside can take it down to 1740. Silver has broken below 22 and can fall to 21 before bouncing back from there. Copper is stuck within 4.45-4.25 and needs t break on either side to give further directional clarity.
Brent (73.07) and WTI (70.03) both trade lower and can possibly bounce back from 73 and 70 respectively to head higher towards 77/78 and 74 again on the upside. Failure to bounce from immediate supports can take it lower towards 70 and 68/67 respectively. Watch price action near current levels.
Gold (1772.20) trades just at immediate support zone of 1760/1770 and needs to bounce back immediately towards 1790-1800 else a fall towards 1740 and lower can come into the picture soon. Silver (21.94) on the other hand has brken below 22 showing near term weakness and has scope to fall towards 21.00 on the downside before bouncing back from there. Note that 21 is a crucial support which needs to hold to keep bullish possibilities alive. Else a break below 21 would be strongly bearish in the longer run.
Copper (4.2695) needs to break on either side of the 4.25-4.45 region to indicate further directional clarity. Till then we expect the narrow range to hold for now.
FOREX
Dollar Index seems to be rising slowly towards 97 before falling from there. That may take the Dollar Yen higher towards 114 before a decline is seen. Euro may head towards 1.1250-1.1200 before a bounce is seen again. EURJPY is stuck below 128. USDCNY can fall while below 6.34. USDINR has scope to rise towards 76.0-76.20. Aussie and Pound are stable just now and can be ranged for the near term. Markets may see some volatility after the FOMC statement due tonight.
Dollar Index (96.535) has scope to rise towards 97 on the upside but thereafter we need to see if it moves up further to test 98 or comes off to fall to 96-95.50 again. We continue to look at the 95.50-97/98 range to hold for now unless a break on either side is seen.
Euro (1.1261) has been in a narrow range for the past couple of weeks, stuck within 1.14-1.12 region. The Euro is falling from 1.1350 and is likely to test 1.1250-1.1200 on the downside before again bouncing back from there in the medium term. Watch price action near 1.1250-1.1200 in the near term.
EURJPY (128.06) is holding well below 128.50 and can fall towards 127.50-127 on the downside before again bouncing back from there.
Aussie (0.7107) is likely to trade within 0.72-0.70 in the next few sessions. A break below 0.71, if seen can drag it lower towards 0.68. Overall immediate view is bearish while below 0.72.
Pound (1.3230) is rising slowly from 1.3190 and can test 1.3250-1.33 on the upside before deciding further direction from there. Immediate range of 1.3250-1.3150 may hold for the next few sessions.
Dollar-Yen (113.72) has risen from levels seen yesterday and can test 114.A break above 114 will then be needed for the pair to rise further towards 114.50 or higher else a fall from 114 would again take the pair down to 113-112.50. Immediate range of 114-112.50 may hold for the next few weeks unless a break above 114 is seen.
USDCNY (6.3646) is ranged below 6.37 and may slowly fall towards 6.35/34 in the medium term. View is bearish while below 6.37.
{USDINR (75.87) closed higher yesterday and has scope to rise towards 76.0-76.20 on the upside. View is bullish for the pair while above 75.80/85.
INTEREST RATES
The US Treasury yields have inched up slightly and would now wait for the US Federal Reserve meeting outcome tonight. Broadly we expect the yields to remain in a sideways range for now and move up within it in the coming days. While an increase in stimulus taper has already been factored in, what the Fed has to say on the interest rate front will be interesting to watch tonight. The German yields remain lower and keep our bearish view intact. The European Central Bank meeting is due tomorrow. The Indian 10Yr and 5Yr GoI remain stable within their broad sideways range.
The US 2Yr (0.65%), 5Yr (1.23%), 10Yr (1.44%) and the 30Yr (1.82%) yields have inched up slightly after having fallen sharply on Monday. We expect the yields to oscillate in the range of 1.35%-1.65% (10Yr) and 1.7%-2% (30Yr) in the coming weeks. Within this range, the chances are high now for the yields to move up towards 1.65% (10Yr) and 2% (30Yr) while they sustain above 1.35% (10Yr) and 1.7% (30Yr).
The German 2Yr (-0.70%), 5Yr (-0.60%), 10Yr (-0.37%) and 30Yr (-0.07%) yields have inched up slightly but broadly remains lower. Bearish view remains intact. We expect the yields to fall further towards -0.45% / -0.5% (10Yr) and -0.1% / -0.2% (30Yr) from here in the coming days.
The Indian 10Yr (6.3558%) and 5Yr (5.6798%) GoI remains stable within their respective range of 6.3%-6.4% and 5.62%-5.73%. The broad sideways range is likely to remain intact. The price action over the last couple of days indicate that the 10Yr and 5Yr can dip within this range in the near-term.
