Morning briefing: Crude prices remain lower

Vikram Murarka Kshitij Consultancy Services

Dollar Index has fallen sharply, holding below resistance at 104.50 while Euro has moved up above 1.07 and can rise to 1.0750-1.08 while it trades higher. EURJPY and USDJPY have dipped and could trade lower for a while. USDCNY and USDRUB could be ranged within 7.05-7.12 and 79.70-82.00 levels respectively. Pound and Aussie have risen back but could be ranged within 1.2350-1.2550 and 0.6650-0.6550 respectively. USDINR can trade within the 82.30-82.75 region for the next few sessions while EURINR can trade above 88.

The US Treasury yields have dipped slightly. Key resistance ahead and lack of momentum can keep the upside capped. We can expect the yields to fall in the coming days. The German yields have risen further. But key resistances are coming up that have to be broken to extend the upmove. Else a fresh fall is possible. The 10Yr and 5Yr GoI are consolidating within their downtrend. There is some more room left on the downside before a fresh upmove begins.

Dow Jones and DAX have declined from the levels of 33800 and 16100 but could get some support at 33300 and 15950 respectively. Nifty remained stable yesterday but outlook is bullish to see a test of crucial resistance in the coming sessions. Nikkei continues to rally. Shanghai is gradually moving up towards 3250 and may rise further in the near term.

Crude prices remain lower and are likely to come down further towards their lower end of the range. Gold and Silver have recovered a bit. Copper is likely to be ranged while it remains below 3.80.

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Author

Vikram Murarka

Kshitij Consultancy Services

Vikram has been forecasting, trading and hedging currencies since 1991. Beginning his career as a currency trader in Essar Group, he was managing an FX exposure of $1.2 bln.

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