STOCKS
Dow (22997.44, +0.18%) has finally almost reached to our initial target of 23000 and the upside bullish momentum looks strong for the coming sessions which could take the index higher towards 23250 soon.
Dax (12995.06, -0.07%) is trading along the resistance near 13000-13050 region and could remain sideways within the said region for a few more sessions. The dip could possibly extend towards 12850-12800 levels also in case the rejection from 13050 lasts for the medium term.
Nikkei (21354.56, +0.09%) is stable below 21400 for the last 2-sessions and could possibly face some difficulty in attempting a rise above 21400 just now. While interim resistance near 21400 holds, we could see a fall towards 21200 or lower in the near term.
Shanghai (3378.77, +0.20%) could re-test 3400-3410 while above 3360. Near term look sideways to bullish in the coming sessions.
Nifty (10234.55, +0.04%) was almost stable yesterday. As mentioned earlier, the upside could be limited to 10300-10320 levels in the near term before we see a small corrective dip from there. Today would be the last trading session of the week as the Indian Markets would be closed for the next 2-days for Diwali. A slight upside could possibly be seen today targeting 10300.
COMMODITIES
Gold (1287.20) is likely to remain above 1280 for the coming sessions. Overall broad range of 1310-1280 is likely to remain for the medium term. A bounce back from 1280 to 1300 levels can be seen in the near term. While the US Dollar Index (93.48) remains in the 93.0-94.0 zone, Gold could trade sideways in the 1300-1280 region.
Silver (17.06) can trade in the 17.50-16.75 region, 17.50 being an important near term resistance.
Brent (58.28) is up in line with our expectation and could test 58.50-59.00 soon. A dip from 59.00 looks more likely just now.
WTI (52.12) has risen as expected but may not move above 53.00-52.50 just now. A dip back towards 51 is likely in the near term while below 52.50.
Copper (3.2105) is trading above 3.20 and could possibly come off from current levels as decent resistance is visible just above current levels on the line charts. Preferred view is a dip to 3.15/10 before again rising up to current levels.
FOREX
The mentioned Support at 1.1730 has held well enough on the Euro (1.1772), keeping the preferred bullish possibility alive. Look for a near term range of 1.1730-1860 for the next few days ahead of the ECB next week.
The Euro-Yen (132.07) is stable near yesterday’s level while the Dollar Index (93.46) trades just below the 93.50 Resistance mentioned yesterday. We need to see if it comes down from here or not.
Dollar-Yen (112.18) is also stable/ mixed with a slight bullish slant which can target 113.00 on the upside if it works.
The Pound (1.3195) is down a decent bit from Monday’s high of 1.3338. Near-term Resistance at 1.3250 now and longer term Resistance is in the 1.34-35 region.
Like the Euro, the Aussie (0.7850) has found good Support on the 21-week Moving Average at 0.7810 and can target 0.80 while that holds. Immediate Resistance seen at 0.7915.
Dollar-Rupee (65.03) might be quiet today on account of Diwali holidays from tomorrow. Next week could see 65.15.
INTEREST RATES
US yields (5Y 1.96%, 10Yr 2.30%, 30Yr 2.80%) dipped slightly yesterday after having moved up on Monday after Yellen’s assertion of interest rate hikes to come. In the medium term, there may be room for US yields to rise by 20-25 bp going into December.
The US Yield Curve (30-5 Spread 0.85%, 30-10 Spread 0.51%) is as flat as it was back in 2007-2008. The 30-10 could dip some more towards 0.49%, but the 30-5 could bounce from Support seen near current levels.
Going into the ECB meeting next week, the market will look for the ECB’s decisions on how and from when it intends to start reducing its ongoing QE.
In India, the 10Yr GOI (6.7631%) has Resistance at 6.78%, which is likely to hold.
