STOCKS
Dow (26773.94, +0.46%) has moved up and has closed above 26750. Although immediate resistance is visible near 27000 on the daily candles, there could be some sideways consolidation in the near term before the index moves higher. Note that 27000 is a crucial resistance and needs to break on the upside to ensure medium term bullishness.
Dax (12287.58, -0.42%) is stable below the 12400-12500 resistance and could probably remain so for some more sessions in the near term. While 12400-12500 holds, the index could come off towards 12100-12000 on the downside before again attempting to bounce higher. For now Dax looks stable to bearish for the near term.
Nikkei (24207.91, -0.26%) has seen a slight dip from levels above 24400. If the resistance on the weekly candles holds, Nikkei could see corrective fall towards 24000-23500 in the near term. Sustained rise above 24500 is needed to negate a fall back towards 24000 just now.
Shanghai (2821.35, -1.06%) is closed for the week and may move up towards 2850 next week when it opens after a week-long holiday.
Nifty (11008.30, +0.71%) bounced back well on Monday after testing a low near 10850. While immediate support near 10800 holds, Nifty is likely to move up eventually towards 11200. Near term is bullish while above 10800.
COMMODITIES
Overall commodities have risen and are trading higher.
Brent (84.85) and WTI (75.23) are rising sharply in line with our expectation. Brent and WTI could face immediate resistance near 85-86 and 76 levels respectively which could produce a short corrective dip in the near term for the Crude prices. A break above 86 and 76, if seen could be bullish taking Brent and Nymex WTI towards 90 and 78 respectively in the medium term.
Gold (1211.10) has risen well moving above 1200. It could test 1220 resistance and needs to break in order to continue its upmove towards 1230-1250 in the medium term. Watch important resistance near 1220.
Copper (2.8170) has risen a bit but is overall trading in the broad 2.75-2.85 region. Some more sessions could see a consolidation in the said range before eventually moving higher in the longer run.
FOREX
Euro, Yen, Pound and Aussie look near term bearish towards 1.14, 115, 1.28 and 0.71 respectively. Rupee might also weaken beyond 73 today.
Dollar Index (95.307) has immediate resistance near 95.75, as seen on daily candles and weekly line chart. Higher up, there is longer term resistance near 96.5. Expect a test of 96.5 by next week.
Euro (1.1582) is trading just above crucial horizontal support (1.151-1.153) on daily candles. On daily line chart, the horizontal support line near 1.156 has been broken and the Euro looks bearish. This bearishness is seen on weekly candles as well : possible downside target of 1.14 by next week.
Dollar Yen (113.79) is currently respecting resistance near 114 on daily candles and daily line chart. A further upmove towards resistance near 115 on weekly candles seems likely by next week.
Euro-Yen (131.796) is trading at support on daily candles near 131.0-130.75. Given that Euro could fall to 1.14 and Dollar Yen could rise to 115 by next week, Euro Yen might just stay stable above 131 till next week.
Pound (1.2995) : If support near current levels i.e near 1.2975 breaks, a fall towards lower support (1.280-1.275) might take place by next week.
Aussie (0.71803) is looking near term bearish towards long term support near 0.71 on weekly line chart, which it could test by next week.
Dollar Rupee (Monday on shore closing: 72.915; current offshore NDF: 73.36) : Looks like USDINR might cross above 73 in today’s session as the NDF is already trading near 73.36. Sharp rise in the crude prices could initiate a session opening near 73 today. At the same time we should also be aware of the possibility of a near term rebound in Indian equities – which might be a source of strength for the Rupee.
INTEREST RATES
The trade deal between US, Canada and Mexico has restored some confidence in the markets and could be bullish for yields. However, erosion of confidence in Italian bonds might have a bearish effect on US and German yields.
The US 10 Year (3.069%) continues to stay below 3.10%. Looking at the charts, preference is for it to come off towards 3.0-2.9% in the medium term.
The 10 Year German-US spread (-2.644%) has broken below the crucial -2.55% support level. There is interim support now near -2.65%. However, on long term chart, it looks bearish towards atleast 2.70% in the weeks ahead.
The German 10 year yield (0.425%) has come off from resistance near 0.5% and could now see a drop till support near 0.3% in the next 1-2 weeks.
The Japan 30Yr (0.89%) is at long term resistance level near 0.90%-0.93%. If it breaks above this level, it could be bullish for shorter term Japanese yields as well.
