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The lower US ISM manufacturing data release led the Dollar index to decline and the Euro to strengthen a bit but the movement was short-lived. The Dollar Index and Euro can trade within the range of 106.50-105/104 and 1.0650-1.0750/08 respectively for some time. Dollar-Yen and EURJPY can soon test upper targets of 162 and 174 respectively and can see further extended bullishness in the absence of any intervention from the BOJ. Aussie & Pound have dipped sharply and could fall towards the lower end of their respective ranges of 0.6580-0.6720 and 1.26-1.28. USDCNY can rise towards 7.28 while above 7.27. EURINR can trade within 89.00-90/91 region for some time. USDINR may continue to trade within its range of 83.67-83.40/30 in the near term with possibilities of an eventual upside breakout in the medium term.
The US Treasury yields are moving up in line with our expectation. An extended rise looks possible before a reversal is seen. The German yields have surged. The momentum looks strong which can take the yields further higher in the coming days. The 10Yr and 5Yr GoI are inching up slowly. They have room to rise further from here.
Dow Jones remains range-bound but has scope to see a breakout on the upside. DAX needs a breakout on either side of its range to get clarity on future direction. Nifty sustained higher above 24000 but needs to rise past 24200 to strengthen the bullish momentum or else can fall back. Nikkei lacks a strong follow through rise above 40000 but bias remains bullish to see further upside while above 39000. Shanghai has risen well to 3000 and has potential rise towards 3050-3100 in the near term.
Crude prices have risen sharply and looks bullish to target their key resistance in the near term. Gold, Silver and Copper have resistance overhead. Gold can trade sideways below its resistance for a while. Whereas Silver and Copper would remain vulnerable to a fall if the resistance holds. Natural Gas has fallen further below 2.5 and looks bearish towards 2.3-2.0.
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