Morning briefing: EUR/USD eyes 1.1100 support amid persistent US Dollar rally

Vikram Murarka Kshitij Consultancy Services

The rising Dollar index continues to remain bearish for the Euro targeting 1.11 while USDJPY can see a slow rise towards 159 or higher and EURJPY can test 176 before a rebound is seen. EURINR has fallen sharply on sharp decline in USDINR yesterday could trade below 107, opening chances of a dip to 106. USDCNY could trade sideways for sometime while above 6.69. USDINR can attempt to test 95.50 or lower towards 95.30 but may soon bounce back towards 96 or higher. The current dip is likely to be short lived.

The US Treasury and the German Yields remain lower and stable. The downside remains limited for the US Treasury Yields. The outlook remains bullish and they are likely to rise back again. The German Yields on the other hand can dip further to test their support. Thereafter a fresh leg of rise can happen. The 10Yr GoI has surged yesterday. The bullish outlook is intact. The expected rise seems to be happening much faster.

Dow can rise towards 52500 on a decisive break above 52000, else it can fall back towards 51500 or lower. DAX is holding above 25000 with upside towards 25500. Nifty remains weak below 22600, with downside towards 22200-22000. Nikkei is coming down towards 67000. Shanghai remains weak below 3800 and can fall towards 3700.

Brent and WTI have risen sharply amid threats to global energy supplies and escalating attacks in the Middle East, with ranges of $100-$110 and $85-$100 likely to prevail, respectively. Gold can rise towards $4300-$4400 while above $4100, while silver needs to hold above $60 to target $63-$65. Copper could rise towards $6.80-$6.85, while Natural Gas may sustain within a range of $3.00-$3.50 as long as it holds above $3.00.

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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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