Morning briefing: EUR/USD can test support at 1.1300

Vikram Murarka Kshitij Consultancy Services

The Dollar index risen and has scope to test 101.60/80 in the near term before pausing for a reversal, while Euro can test support at 1.13. USDJPY has scope to rise slowly towards 158-159 while EURJPY can test 180 in the next few sessions within the broader 181-178 range. USDCNY is headed towards 6.70 while USDINR needs a breakout above 96 to target 96.25/50 soon. Aussie can dip to 0.70 or lower to 0.69 while Pound may hold above crucial support at 1.32.

The US Treasury and the German Yields continue to move up in line with our expectation. Both keep their bullish view intact. They can rise further from here. The US PCE data release tomorrow will need a close watch. The 10Yr GoI has risen breaking above its key resistance. So, the expected reversal seems to be not happening. While this break sustains, the 10Yr GoI can go further higher from here.

Dow remains weak and can decline towards 51500-51000. DAX can rise towards 26000 while remaining range-bound between 25350-26000. Nifty remains weak below 23000 and can decline towards 22600-22500. Nikkei can decline towards 65000-64000 while below 67000. Shanghai has held 3800 support and can bounce towards 3850-3900.

Brent and WTI remain positive, with further gains towards $110-$115 and $98-$100 possible. Gold remains weak and needs to hold $4100 to avoid a decline towards $4000-$3900. Silver can decline towards $60, while Copper remains bearish towards $6.60-$6.50. Natural Gas remains weak and can test $3.00 and lower.

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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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