STOCKS
Equities broadly remain positive except India’s Sensex and Nifty which are stuck in a narrow range and look mixed in the near-term. Dow has closed on a strong note last week and has room to rise further this week. The US markets are closed today. DAX has risen above 13500 and is bullish. Nikkei sustains above 24000 and can test 25000. Shanghai can move up if it sustains above 3065.
Dow (29348.10, +50.46, +0.17%) sustains higher and has closed on a strong note last week. The US markets are closed today.
DAX (13526.13, +96.70, +0.72%) has risen above 13500 and need to be seen if it can sustain above it. While above 13500 a rise to 13670-13700 is likely.
As expected Nikkei (24101.85, +60.59, +0.25%) sustains above 24000 and keeps our bullish view intact. As mentioned on Friday, while above 24000, a rise to 25000 is possible now.
Shanghai (3082.12, +6.62, +0.22%) holding above the intermediate support level of 3065. While above this support, the chances are high for the index to breach 3125 and rise to 3190 and 3210 going forward.
Sensex (41945.37, +12.81, +0.03%) and Nifty (12352.35, -3.15, -0.03%) are stuck in a narrow range and look mixed in the near-term. Sensex is stuck between 41800 and 42065 while the Nifty remains in the narrow range of 12300-12400. We will have to wait to on which side these indices break out.
COMMODITIES
Crude and precious metals may rise in the near term as support below current levels seem to be holding well. Copper on the other hand faces sharp rejection from daily trend resistance and could continue to fall in the next few sessions.
Brent (65.57) could test 66.00-66.20 levels in the near term. Support near 64 is holding well for now. Nymex WTI (59.14) is also holding above support at 58 and could move higher targeting 60 in the next few sessions.
Gold (1557.50 and Silver (18.02) have moved up. 1540-1570 could be the trade region for the near term for Gold with a possibility of an initial rise towards 1570. Silver is likely to hold above 17.75 and could rise to test 18.25-18.50 in the near term. View is bullish for both Gold and Silver for the next 1-2 sessions.
Copper (2.8480) has dipped after testing 2.90, the immediate trend resistance on the daily charts. While 2.90 holds, we may expect a dip to 2.80 or slightly lower in the near term.
FOREX
Dollar Index (97.61) is likely to hold below immediate resistance near 97.75/80 and may come down to test 97.00-96.75 in the near term.
Euro (1.1096) has come down to trade below 1.11 now and may test 1.1068-1.1050 in the near term before bouncing back again to current levels.
Dollar-Yen (110.18) is stable just now. Immediate resistance is seen at 110.30 which if holds could push back the pair to 109.50 or lower. Note that a sustained break above 110.30, if seen could take the pair further up towards 110.50-111 levels in the near term.
EURJPY (122.28) is holding below resistance near 123. Although there is scope for a rise towards 124 on the long term charts, we would watch price action near 123 and expect a dip towards 122 or lower in the near term.
Pound (1.3004) is trading near support levels and we cannot negate a rise towards 1.32 unless it breaks below 1.29.
Aussie (0.6882) has bounced from a very near term support and while that holds, Aussie may move up towards 0.69-0.6921 in the near term.
USDCNY (6.8495) may test the Jun-July’19 low of 6.83 in the near term before bouncing back from there. Near term looks bearish.
Dollar-Rupee (71.09) broke above 71 to close higher on Friday indicating bullishness for the next 1-3 sessions this week. A rise towards 71.25/30 is likely to be on the cards for the near term before a corrective dip is seen.
INTEREST RATES
The supports on the US Treasury yields are continuing to hold well. While above these support, the Treasury yields can move up this week. The German yields can dip to test their supports in the near-term and then can resume their uptrend. The 10Yr GoI can consolidate sideways.
The US 2Yr (1.56%), 5Yr (1.62%), 10Yr (1.82%) and 30Yr (2.28%) Treasury yields sustains higher. The 30Yr is holding well above 2.25% and may have the potential to rise towards 2.35%-2.40% while it sustains above this support. The 10Yr has bounced from its support level of 1.79%. While this support holds, a rise to 1.90%-1.95% is possible. We will have to wait and see if the yields sustain above their supports.
The German 2Yr (-0.60%), 5Yr (-0.52%), 10Yr (-0.22%) and 30Yr (0.29%) yields remain lower but stable. . As mentioned on Friday, there are chances to see an intermediate dip within the overall uptrend. The 10Yr can test -0.25% and the 30Yr can test 0.25% after which they can reverse higher again and keep the uptrend intact.
The 10Yr GoI (6.6262%) has bounced on Friday and may remain range bound between 6.60% and 6.70%. We expect the downside to be limited to 6.5750% if a break below 6.60% is seen.
