Morning briefing: EUR/USD is bearish below 1.1300

Vikram Murarka Kshitij Consultancy Services

The Dollar index looks bullish for the near term while the Euro is bearish below 1.13. USDJPY can rise slowly towards 159 while EURJPY looks weak. EURINR could have limited downside and could soon bounce back in the coming sessions, while USDCNY is closed today. USDINR has scope to test 96.00-95.80 while below 96.35/50. A decisive break above 96.50 could turn bullish. Aussie and Pound could hold above crucial supports at 0.69 and 1.32 respectively and move up slowly.

The US Treasury Yields continue to rise. The bullish view is intact. They can rise further and test their intermediate resistance. From a long-term perspective, there is potential to see much higher levels. The German Yields have risen back well from near their support. That keeps intact the broader uptrend. A follow-through rise from here can take them higher. The 10Yr GoI sustains higher. It has room to rise further from here. RBI’s monetary policy outcome tomorrow will need a close watch.

Dow and DAX need to break 51500 and 25500 for further upside, otherwise downside risks remain. Nifty may open flat and needs to sustain above 22600 for a move toward 23000, while failure to hold could drag it toward 22200–22000. Nikkei remains bullish above 70000 with scope toward 72000, while a break below 70000 would expose 66500–66000. Shanghai remains closed for the Golden Week holiday and will resume trading on October 8.

Brent and WTI remain positive above support and can rise towards $105-$110 and $95-$100. Gold needs to hold $4100 for a rise towards $4300-$4400. Silver needs to sustain above $60 for a rise towards $63-$65. Copper remains positive and can rise towards $6.75-$6.80. Natural Gas remains positive and can rise towards $3.10-$3.20.

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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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