STOCKS
As hoped for, there has been decent profit-taking in Equities across the world, with important Resistances holding across all Indices. More downside seems likely.
Dow (24528.22, -208.98, -0.84%) came down well from below Resistance at 25000, to see a low of 24324. It would be prudent to think of 24000 (at least) in the coming weeks.
The DAX (11210.31, -71.48, -0.63%) has also come down well, after having risen to 11321.62 on Friday. So, with yesterday’s fall, the DAX too remains below important Resistance at 11300. Looking at the Weekly Candles, there are equal chances of a dip to 10900 as of a further rally to 11500. Possibly the downside might be more probable.
Both Nikkei (20448) and Shanghai (2571) have dipped yesterday and have fallen further today, as the crucial resistances at 21000 and 2660 (21-MA on Weekly Candle Chart) respectively are holding strong. Look for a dip to 20400 and 2550 respectively in the near term, possibly lower also.
In line with expectation, both Sensex (35656.70, -368.84, -1.02%) and Nifty (10661.55, -119.00, -1.10%) have fallen to 35600 and 10670. Trading just above the support coming from October-2018, they could possibly produce a bounce back towards 35800 and 10800. If not, both indices could be further bearish towards 35000 and 10500 respectively in the medium term.
COMMODITIES
Overall the commodities are mixed. The crude prices have dropped sharply while the metals are stable.
Crude demand has picked up this month in China as news states buying for March-April delivery while purchases for Jan-Feb remains low. Brent and WTI saw a sharp fall and is trading lower while our mentioned upside resistances of 64 and 56 holds for now.
Brent (60.01) could come off towards 58 and WTI (52.12) towards 51-50 levels. A small corrective move could be in place for the next few sessions.
Gold (1303.10) and Silver (15.76) are almost stable and holding at higher levels seen yesterday. While Gold is above 1300, scope of testing 1310/20 is in place. Silver has room towards 16.00-16.50. Near germ could be bullish.
Copper (2.6870) came back sharply from levels above 2.70. Below 2.70, copper could re-test 2.65/60.
FOREX
Dollar Index (95.74) could come off to test 95 before bouncing back from there.
Euro (1.1429) could possibly face a small dip from 1.1450 before again attempting to rise further. On the 3-day and weekly charts, Euro looks bullish towards 1.15.
Dollar Yen (109.19) could come off towards 109.00-108.80 levels in the near term while the Dollar index heads towards 95. A short dip looks likely just now within a longer term uptrend.
Pound (1.3148) has tested 1.32 and is coming off from there. While 1.32 holds, Pound could see some corrective dip in the near term towards 1.31-1.30 levels.
Aussie (0.7159) is up today after testing 0.7138 yesterday. A fall in Copper prices (refer to commodities section above) could lead to a fall in Aussie also towards 0.71.
USD-CNY (6.7413) has support near 6.72 and while that holds we could see a bounce in the pair towards 6.75-6.78 levels.
Dollar Rupee (71.11) has immediate support near 70.80/90 and while that holds, Dollar-Rupee could trade in the 70.80-71.25 region over the next 1-2 sessions. Only on a break above 71.25/30, if seen would turn bullish for the medium term.
INTEREST RATES
The German-US 2Yr Spread (-3.17%, down from -3.16%) is moving lower towards its 200-day MA Support near -3.25% while the German-US 10Yr Spread (-2.54%, up from -2.57%) has moved up a bit after testing the 200-day MA Support near -2.57%. We have to watch to see if the mentioned 200-day MA Supports continue to hold over the course of this week.
On the US Yield Curve, the 1-5 year section of the Curve is inverted, with the 1Yr (2.59%) > 2Yr (2.58%) > 5 Yr (2.57%). At the Far end, the 30-5 Spread (0.49%) and 30-10 Spread (0.32%) have Resistances near current levels. This suggests that the 30Yr (3.06%) can slowly come down towardxs 3.00%.
The Indo-US 10Yr Spread (4.79%) is trading near its 200-day Moving Average at current level and may have room to slowly move up towards 4.90%. Else, it could trade sideways near current levels. Let us see how that goes.
