STOCKS
The daily momentum as seen on the daily line charts indicate that a possible dip is coming up on the Dow (24664.89, -0.34%) in the near term. Currently trading near important levels, it is important to see if the Dow comes off from 25000 or manages to move up in the next few sessions. A rejection from 25000 looks more likely with a possibility of testing 24250 on the downside.
Dax (12567.42, -0.19%) has paused just at the daily resistance near 12600. Being an important levels, a break or dip from here would determine the next course of action. While 12600 holds, the index could come off to test 12400-12200 again; else a rise above 12600 could trigger a medium term uptrend.
22500-22550 is crucial resistance zone for Nikkei (22222.13, +0.14%) which could push the index towards 21800-21600 levels in the coming sessions. Such a dip, if seen in Nikkei could limit the upside for Dollar Yen (107.63) just now.
Shanghai (3091.35, -0.83%) moved up sharply from 3050 and is currently trading just below important levels near 3100-3150. While these levels provide some resistance, Shanghai looks bearish for the medium term. A break above 3150 could indicate some upmove in the next few sessions.
Nifty (10565.30, +0.37%) has not been able to close above the crucial resistance near 10600 and while that holds, a dip back to levels near 10400 looks likely. Sensex (34427.29, +0.28%) also seems to have made a near term top and could now fall a bit towards 34000 or lower in the coming sessions.
COMMODITIES
Brent (73.83) is trading near crucial levels. Although we had mentioned a rise towards 76 yesterday, there is an interim resistance near 74 which is likely to keep the prices stable or push it down towards 72. Near term likely to be stable if not very bearish.
Nymex WTI (68.37) has important weekly resistance near 69 (revised from yesterday’s mentioned 70) which is likely to hold just now, either keeping the WTI price stable or pushing it down towards 67-66 levels. Upside is likely to be limited at 69 just now.
Gold (1344.71) is limiting itself in a narrow range of 1340-1370 for the near term. 1340 is a decent near term support while 1370 is an important resistance which the index is finding difficult to break just now. Some sideways consolidation is possible for a few sessions.
Copper (3.1320) has immediate resistance near 3.15-3.17 and while that holds, Copper is likely to come off towards 3.10-3.07 in the near term. A break above 3.15-3.17 is needed to move higher towards 3.20/25 (less likely).
FOREX
Dollar index (89.95) has risen past 13 days and 21 days moving average lines on daily line chart near 89.8 and could now test higher resistance on 3 day candles near 90.00-90.25, after which it could dip back towards 89.50-89.25.
Euro (1.2340): Euro is testing the 21 moving averages on daily and 3 day line charts near 1.233-1.235 and could dip lower to support near 1.23 on daily candles. A break of 1.23 (if it happens) could be very bearish. Our preference is for the support to hold, leading to a bounce back towards 1.24 and higher.
Dollar Yen (107.65) has continued rising after testing 107.0-106.9 earlier this week and could move up further near previous high of 107.78. It needs to be seen if Dollar Yen turns bearish from its previous high or moves up further towards 109 (seen as 21 week moving average on weekly line chart).
Euro Yen (132.84), as per expectation, has stayed below resistance near 133, being provided by 21 moving average on the weekly line chart and also seen as resistance on daily and 3 day candles. This resistance could be broken if Dollar Yen continues to move up towards 109 and Euro bounces towards 1.24. The maximum upside for Euro Yen in the near term could be 135-138 ( corresponding to 109-110 on Dollar Yen and 1.25-1.26 on Euro); after which it could turn bearish.
Pound (1.408) has dipped very quickly to test support near 1.410 on daily line chart after testing strong resistance near 1.43-1.435 (on 3 day line chart). If it breaks this support, there is lower support near 1.40 on daily candles. Further lower, there is crucial long term support level near 1.38-39 on weekly line chart, whose break could make Pound very bearish. If current support near 1.41-1.40 holds, Pound may attempt a rise towards 1.46 (crucial long term resistance on weekly line chart).
Dollar Rupee (65.795): Target of 66.15 could come earlier than end-April/ early-May also.
INTEREST RATES
In the past few days, US yields have continued rising in response to crucial US economic indicators throwing up improved numbers. Industrial Production, Capacity Utilization, US Retail Sales data, unemployment claims data and the Fed minutes had all indicated a growing US economy. In addition, rising commodity prices (specially, Crude) has increased inflation expectations and is fuelling the rise in US (and even German) yields.
US 10 Yr Yield (2.9173%), 30 Yr (3.1073%), 5 Yr (2.76%), 2 Yr (2.43%):
The US 2 year yield has reached its highest levels since 2008 and could rise higher in May. Upside could be restricted to 2.5% in the near term.
The 10 Year yield (2.9173%) is very close to resistance near 2.92% on medium term chart and could dip towards 2.85%-2.825% from here in the next week. It is likely to creep up towards 2.95% in May as long as crude prices remain elevated.
The 30 yr yield as we expected, has moved up further towards 3.1%. It could move up slightly more towards 3.12% (even 3.15%) and then dip.
