STOCKS
Dow has risen slightly today but chances of a fall towards 35250-35000 is still possible. Dax has room to rise towards 15800-15900. The view in Nikkei is bearish to see a fall towards 28500/28250. Shanghai has room to fall towards 3625 , if the index falls further the a test of 3550 is possible, else if we see a bounce from 3625 then a rise towards 3700 can be seen. Nifty can rise towards 17400/600, while above 17200. If seen a break below 17200 is seen ,the fall can be limited to 17000/16800. Sensex has scope of falling towards 57500-57000.
Dow (35897.64, -29.79, -0.083%) has chances to see a fall to 35250-35000 in the near term. A broad range between 35000-36000 can be seen in the near term. A sustained break above 36000 will reinforce bullishness.
DAX (15636.40, +160.05, +1.03%) has come down after testing a high of 15780.90. While above 15500, a rise towards 15800-900 is possible.
Nikkei (28799.60, -266.72, -0.92%) has come down sharply today in line with our expectations to see a fall. The view is bearish to see a fall towards 28500/28250 on the downside. Further break below 28250 can take the index down towards 27000.
Shanghai (3646.83, -28.19, -0.78%) has come down after testing the high of 3673.53 as we has expected. A break below 3625 if seen can take the index down towards 3600 and 3550 eventually. Else, if the index manages to bounce from 3625 then a rise to 3700 is possible.
Nifty (17248.40, +27, +0.16%) closed above 17200 yesterday keeping a rise towards 17400/600 possible in the near term. A fall, if seen can be limited to 17000/16800. We expect a broad range of 16800/17000-17800 to hold for the next 1-2 weeks.
Sensex (57901.14, +113.11, +0.20%) rose slightly yesterday. The view is still bearish to see a test of 57500-57000 before we see a bounce back. Only a sustained rise above 58000 will negate the downside.
COMMODITIES
Crude prices remain in a sideways consolidation and need to break on either side to start a fresh trending movement. Till then we may look at Brent and WTI to trade within 78-72 and 74-69 respectively. Gold and Silver have both risen after seeing a sideways range for almost 2-weeks. A rise to 1820 on Gold and towards 23 or higher on Silver is possible by the coming week. Copper is bullish while above 4.00/10. Interim resistances seen at 4.35 and 4.40.
Brent (74.85) can fall towards 72-70 while below immediate resistance zone of 77/78. WTI (71.95) on the other hand looks likel it can be raged within 74-69 region for sometime before a break on either side is seen.
Gold (1804.00) and Silver (22.55) have risen well. Gold has moved up above 1800 as support near 1750/60 seems to be holding well for now. After a long sideways range of 2-weeks Gold has moved up and if the rise sustains, it can target 1820 on the upside. Thereafter it needs to break above 1820 to move up further else a fall back to 1750 cannot be negated. Silver has risen well and a break above 23 if seen can take it higher towards 24.50 eventually. Watch price action while above 22.
Copper (4.3080) broke below the immediate support at 4.25/20 and fell to almost test 4.10 on the downside before bouncing back sharply to current levels. Broad range of 4.00-4.35 may hold for now. A break above 4.35 if seen can take it higher to 4.40/50 on the upside. In the longer run, view is bullish while above 4.00-4.10.
FOREX
Dollar Index fell to show some near term weakness, remaining within the 95.50-97 range while Euro has scope to trade within 1.1355/60-1.1250 for the very near term. EURJPY rose sharply yesterday but has come off and could hold within 129.50-127.50 for at least the next couple of weeks. Aussie and Pound could slowly inch up in the near term. USDCNY can trade within 6.38-6.36 while USDJPY has come off sharply and hold within 114.50-112.50 region for the near term. USDINR came off sharply yesterday to close near 76.09. We need to see the weekly close today to decide if the upside possibilities of 76.80-77 is still intact for the near term.
Dollar Index (96.03) fell sharply from 96.45 seen yesterday. We continue to look for a fall in Dollar Index towards 95.50 before rising back towards 97. A range of 97-95.50 may continue to hold for the next week as well.
Euro (1.1324) tested 1.1360 before the ECB meeting yesterday but close at lower levels. Today a slight dip is seen butt there is scope for a rise to1.1355/60 on the upside which is also an immediate resistance. A range of 1.1355/60-1.1250 may hold for now and can trigger bullishness on a break above 1.1355/60.
EURJPY (128.67) tested 129.637 overnight but came off to levels below 129 just now. A broad range of 129.50-127.50 is likely to hold unless a sustained break on either side is seen in the near term.
Aussie (0.7175) rose sharply to test 0.7223 yesterday but could not sustain higher and instead came down to trade below 0.72 currently. A further fall from here can take the Aussie down towards 0.71 or even lower. Immediate range of 0.7250-0.71 may hold for now.
Pound (1.3324) tested 1.3374 on the upside before coming off sharply from there but the view is bullish for Pound while above 1.3250. There is scope for an eventual rise to 1.34-1.3450.
Dollar-Yen (113.60) fell back to levels below 114 as the Dollar Index weakened. While below 114.50, view is likely to be bearish for a fall towards 113-112.50 on the downside. A break above 114.50 needs to be seen again and sustained in order for Dollar Yen to move up again.
USDCNY (6.3687) is inching up slowly but within a narrow range. While below 6.38, there is scope for USDCNY to fall towards 6.36 and lower again. Immediate range of 6.38-6.36 may hold for now.
{USDINR (76.09) fell sharply yesterday from 76.125 to come back to our expected and earlier range of 76.20-75.80/75. Movement today would be crucial to see if the week closes at levels above 76.20 or lower. While below 76.20-76.00, we may look for a fall to 75.80-75.60 but any break above 76.20 if seen again could bring back bullish possibility of a rise to 76.80-77 or higher on the upside. Watch weekly close today.
INTEREST RATES
Following the US Federal Reserve Bank, the European Central Bank (ECB) yesterday announced that it will cut down its Pandemic Emergency Purchase Programme from next month and will end it by March 2022. The Bank of England has hiked the interest rate to 0.25% yesterday. The US Treasury yields have fallen-back across tenors. We retain our view of seeing a broad sideways range movement in the yields for some time. The German yields have inched up slightly but have resistances ahead that can cap the upside and keep the broader bearish view intact. The 10Yr and 5Yr GoI can move up to test the upper end of their respective range of 6.3%-6.4% (10Yr) and 5.62%-5.73% (5Yr) and then can come down again.
The US 2Yr (0.62%), 5Yr (1.18%) and the 10Yr (1.42%) yields have dipped sharply while the 30Yr (1.86%) remains stable. We reiterate that the yields can oscillate in a broad range of 1.3%-1.65% (10Yr) and 1.7%-2% (30Yr) for some time. Within this if the 10Yr falls below 1.4%, it can dip to 1.3%. The 30Yr on the other hand can test 1.7% if it falls below 1.8% from here. But broadly we see high chances of the yields moving towards the upper end of their range in the coming weeks.
The German 2Yr (-0.71%) and 5Yr (-0.59%) yields remain stable while the 10Yr (-0.36%) and 30Yr (-0.01%) have inched up slightly. With resistances at -0.25% (10Yr) and 0.05% (30Yr) the view remains bearish to see -0.45% / -0.5% (10Yr) and -0.1% / -0.2% (30Yr) in the coming weeks.
The Indian 10Yr (6.3749%) and 5Yr (5.6937%) GoI can move up towards the upper end of their respective range as mentioned yesterday. 6.3%-6.4% (10Yr) and 5.62%-5.73% (5Yr) is the expected range of trade. Within this the 10Yr can test 6.4% and the 5Yr can rise to 5.72%-5.73% and then can come down again.
