STOCKS
Dow (20547.76, -0.15%) has immediate weekly support near 20370-20350 levels which could be possibly tested in the coming sessions. Thereafter a rise back towards 20600-20700 is possible in the longer run.
Dax (12048.57, +0.18%) is trading higher while support near 11930 holds. It could either start moving up from current levels towards 12200 or re-test lower levels of 11930 in which case there could be some sideways consolidation for the coming sessions.
Shanghai (3122.63, -1.59%) could test 3100 or a little lower before bouncing back from there in the near term. Immediate trend is bearish.
Nikkei (18870.24, -1.34%) opened with sharp gap up above levels of 18600 re-entering into the broad sideways channel of 18600-19700. In case it holds, we could possibly see a rise towards 19200 before coming off from there.
Nifty (9119.40, -0.19%) is trading within the immediate daily channel and while support near 9100 holds, we could see some movement along the daily trend support in the 9250-9100 region. A break below 9100, if seen could take it lower towards 9000-8900 in the longer run.
COMMODITIES
We were expecting 1260-65 levels for Gold (1274.79) due to its near-term overbought condition, and today it is trading at 1275. We have been expecting 1260 to hold for some time as buyers are taking every dip as a further opportunity for buying. 1301 could be a level where the price action has to be checked to assess the chances of further bounce to 1328 to 1350 levels. only a close below 1260 could negate the bullish sentiment.
We were also expecting Silver (17.85) to be corrected till 17.70 since last 4-5 days and today silver is trading close to those levels. We think that the corrective phase could be restricted till 17.60-70 levels due to near term oversold condition. Only a close below 17.60 could bring further lower levels of 17.43 levels into consideration.
Nothing new to add as Copper (2.565) has been stuck in the range of 2.50-2.66. A close below 2.50 could open up 2.48 and 2.45 levels respectively. Gradual buying at 2.45-48 levels can’t be ruled out due to near term oversold condition. Only above 2.66, higher resistances of 2.72 -80 can come into consideration.
We were bearish on WTI (49.85) and we had mentioned that "Brent may consolidate within these levels (52.20-53.60)for few more sessions though the possibility of a decline towards supports can’t be ruled out, but a close below 50.30 could drag WTI towards 48.36 levels’. We will remain bearish while Brent (52.22) and WTI are trading below 53.60 and 50.30 levels respectively.
FOREX
Euro has zoomed on the back of a re-ignited risk appetite following the first round of the French Presidential Election. However, it may turn out to be more of a relief rally rather than genuine strength for Euro. On the other hand, the chances of Euro making a significant top and Dollar creating a significant bottom today can’t be ruled out.
Dollar Index (99.30) is at a very crucial juncture now as it has tested our downside target/support of 99.20-10 and shows the initial possibility of a larger degree correction coming to an end, though pending confirmation. The current sharp bounce is in line with expectations and the recovery may well take Dollar to 100.20-50 in the next few sessions.
Euro (1.0829) has overshot our upside target of 1.0820 by a huge margin to register a high at 1.0920 today but the rise may be over for now and a gradual decline to 1.0700 or even lower may be seen in the near term.
Pound (1.2787) is trading quietly in the narrow range of 1.2750-1.2900 as expected but it may test the major support of 1.2600 in the near term.
Dollar-Yen (110.07) is currently testing the resistance of 110.10 which is the make or break level in the near term. A successful break above 110.10 may push the pair up to 111.50-112.00 but a failure at the current levels can keep it in the range of 108.00-110.00. Prefer to wait and watch with slightly bullish bias.
Aussie (0.7555) remains in a horizontal mode in the range of 0.7450-0.7600 which may continue for another week.
Dollar-Rupee (64.62) looks potentially bullish towards 65.00/20 but could trade within the 64.30-64.80 region for a few more sessions before that. Resistance near 64.70/80 could be re-tested a couple of times before finally breaking on the upside.
INTEREST RATES
The US yields are trading higher and could move up slightly in the coming sessions before pausing. The 5Yr (1.84%), 10Yr (2.31%) and the 30yr (2.96%) are trading higher from previous levels of 1.77%, 2.25% and 2.91% respectively. The 30Yr could test 3% while the 10yr could face some rejection from levels near 2.35%.
The US-Japan 10Yr (2.29%) rose back above 2.25% resistance and while that holds, a rise towards 2.33% is possible which could indicate that Nikkei and Dollar-Yen could move up in the next 2-3 sessions.
The UK-US 10yr (-1.28%) has fallen sharply from levels below the long term channel resistance and could indicate that the upside for Pound could be limited in the near term.
The German-US 2Yr (-2.05%) and the 10Yr (-2.06%) have fallen sharply from resistance levels and could come off this week bringing down Euro with itself.
