STOCKS
Dow (25283.00, -0.05%) was quiet yesterday with not much of movement. There is scope of further rise towards 25400-25600 before a corrective dip or sideways consolidation is seen. Overall the index looks bullish.
Dax (13367.78, +0.36%) closed just below resistance at 13400 and while that holds, the index could probably pause for sometime before attempting to move higher. Failure to pause just now could take it higher towards 13600-13800 in the next couple of weeks.
Nikkei (23843.70, +0.54%) saw a dip as the resistance near 113.50 produced a rejection on the Dollar Yen. Weekly resistance is visible near 24000 and that could be tested before a sharp correction sets in.
Shanghai (3412.37, +0.08%) is eventually moving up and could test 3450. Near term looks bullish.
Nifty (10623.60, +0.61%) could face rejection from levels near 10750-10800 which could push it back towards10400 while Sensex (34352.79, +0.58%) is likely to come off from 34500-34650 while above 34200 levels.
COMMODITIES
Gold (1319.11) is in a pause mode after rallying from levels near 1240 in Dec’17. A small pause is possible with a maximum extension towards 1300 on the downside before another leg of rally sets in. Medium term looks bullish.
Brent (68.22) and WTI (62.25) have both moved up quite a bit. As mentioned yesterday, Brent could test immediate resistance near 70 on the upside while WTI could test 63 in the next few sessions.
Copper (3.2330) has come off further and is likely to move down towards 3.20-3.15 in the coming sessions. Near term looks bearish.
FOREX
Dollar Index (92.267) has moved up and seems to be on course to test 92.5-92.75, seen as near term resistance on 3 day candles and 3 day line charts. Simultaneously, we saw Euro (1.1971) break below 1.20, which could now move down towards crucial support near 1.19-1.195 (seen on 3 day and weekly candles) as the Dollar Index moves towards 92.5-92.75.
Dollar-Yen (112.58) as per expectations has seen a dip from resistance level near 113-113.25 and might now test support at 112.50 on the daily candles. This could prove to be a crucial support, which would see a break if Dollar Index goes back to levels below 92.
The Pound (1.3579) is continuing its trade in the narrow range of 1.35-1.36 and we might have to wait for a couple of sessions to get further directional clarity.
Aussie (0.7858) is pausing in its uprise beyond the 200 day moving average on the weekly line charts and should be ranged between 0.78-0.786 for the next couple of sessions.
Dollar-Rupee (63.5050) rose yesterday on back of Dollar strength against the Euro and might see trade within 63.40-63.60 today, with 63.20 acting as a strong support.
INTEREST RATES
The US 10Yr (2.4836%), US 5 Yr (2.2886%) and US 30 Yr (2.8136%) haven’t seen much movement yet. We can expect minimal movement in US yields till the CPI data release on 12th Jan. In case, the data reflects higher inflation due to the recent rise in crude prices, we could see the 5 Yr move past resistance near 2.3 and the 30 Yr could move closer to resistance near 2.9%-3%.
The German-US 10 Yr Yield Spread (-2.0553%) has fallen since yesterday and instead of moving up towards -2%, it could first test support near -2.06%—2.07%.
Japanese 10 Yr Yield (0.068%) has been rising in the last few days, having broken resistance near 0.06% on the short term charts and is now around long term resistance near 0.07%. This has brought the US-Japan 10 Yr yield spread down to 2.4156% and we might see a test of support near 2.36%-2.37% in case the Japanese 10 Yr breaches long term resistance near 0.07%.
