STOCKS
Dow (20951.47, -0.03%) closed lower and lack of any directional momentum just now is keeping the price stable. While below 21000, we could expect a test of 20800-20600 levels before again starting to rise from there.
Dax (12647.78, +0.96%) has broken the resistance on the daily candle charts but looking at the 3-day and weekly charts, the index is at crucial resistance levels and if it breaks on the upside, further rally towards 12750 and higher is possible. Else a corrective dip from current levels could be expected.
Shanghai (3098.24, -0.93%) has just broken below 3100 and may re-test 3075. A break below 3075 could be an important cue to initiate a fresh fall else a sharp bounce from 3075 is needed to take it towards 3150/75 and higher.
Nifty (9359.90, +0.51%) has been moving in line with expectation. Important resistance at 9400 remains intact and could hold in the medium term.
COMMODITIES
Gold (1228) had failed to close above 1239 levels and moved lower against our expectation. It is hovering around its crucial support of 1228. A close below 1228could open up 1188 levels as well. The bias would remain bearish while it is trading below 1256 levels. The scrip id highly oversold in near term time frame thus a possibility of a corrective bounce towards 1240-50 can’t be ruled out.
Similar kind of chart has been formed in silver (16.32) also as it is trading below 16.94 levels. The bias will remain bearish while it is trading below 17.50 levels though a possibility of a rise towards 17 levels can’t be ruled out due to short term oversold condition.
Copper (2.50) is hovering around its crucial support at 2.50 levels, within its trading range of 2.45-2.54. A close below 2.50, which is less preferred, could open up 2.45 levels as well.
WTI (45.41) had moved lower in line with our expectation and hovering around its support at 45.35 levels. A close below that could open up 44.58 and 41.62 levels respectively. Brent (51.73) may consolidate within 50-52 levels for few more sessions though the possibility of a corrective bounce towards resistance can’t be ruled out. We will remain bearish while Brent and WTI are trading below 53 and 51 levels respectively.
FOREX
Dollar has reversed its gains ahead of the US Jobs data tonight and the second round of French election on Sunday but the major trend is still not clear at the moment. By Monday, clarity can be expected.
Dollar Index (98.82) has lost all its gains made in the previous session after its failure to rise above the resistance of 99.50 we have been watching for the last week. Immediate support comes at 98.50 below which comes the major support of 98.30-20 which may hold on the first testing.
Euro (1.00980) has risen sharply as it tests the resistance zone of 1.0970-1.1000 now. A break above 1.10 may open up much higher levels starting with 1.1100 but we would prefer to wait for the breakout to take place first.
Dollar Yen (112.58) is stalling near the resistance of 113.00 as expected but it is not clear yet if the resistance will be able to reject the price sharply enough to trigger any considerable correction. Wait and watch for another couple of sessions.
Pound (1.2918) has bounced back exactly from our support of 1.2830 and our immediate target of 1.3000 may be met in the next 1-3 sessions.
The crash in the commodities this week has hit Aussie (0.7388) hard. The currency is testing the support of 0.7380-70 repeatedly for the last 2 sessions which must be protected by the bulls for any immediate chance of recovery. Failure to hold 0.7370 may open up much lower levels of 0.7300 but the chances of a bounce back can’t be fully discarded yet.
It has been one of the quietest days for Dollar Rupee (64.1750) in the recent weeks as it barely moved away from 64.20 in the entire session. On the other hand, this crash in volatility implies a sharp move coming in the next 2-4 sessions and the direction can be down if the pair fails to rise above 64.40 in the meanwhile.
INTEREST RATES
The Japan-US 10Yr (2.34%) is rising as expected and could heads towards 2.4% in the coming sessions. In that case we could expect a rise in Nikkei an d Dollar Yen too in the near term.
The German-US 10Yr (-1.97%) and the 2yr (-2.01%) have bounced from immediate support levels and have decent potential on the upside. While the yield spread looks bullish, Euro could head higher in the near term.
The US and the UK yields are rising and could move up for the next 2-sessions while the Japan yields are almost stable. The German yields have also moved up sharply and are heading immediate resistance levels from where a rejection is possible.
