Morning briefing: EUR/USD is headed towards the resistance at 1.1800
The Dollar Index is trading lower within its 99-98 range. Need to see whether the support around 98 holds or not. While EURUSD is headed towards the resistance at 1.18. EURINR can trade within 104-106/107 region for some time. EURJPY can test 183/82, while USDJPY can trade within the broad 154-158 range for some time. USDCNY can extend its decline towards 7.025 or even 7.00 while below 7.045. AUDUSD is rising within its 0.66-0.67 range. GBPUSD surged above 1.345 and while the rise sustains, a further test to 1.35-1.36 looks possible in the near term. USDINR can trade within 90.25-89.50 region for some time. US GDP, US Durable goods, US Industrial production, US Capacity utilisation & US Consumer confidence are some of the key releases scheduled for today.
The US Treasury yields remain stable. For now, the yields are likely to oscillate in a range. A bullish breakout of this range is needed to avoid a fresh fall. The German Yields sustain higher. View remains bullish and more is possible from here. The 10Yr GoI has made a bullish breakout. That strengthens the momentum and clears the way for more rise.
Equity indices are looking bullish for the near term with the Dow and DAX targeting 49000 and 24500-24600 respectively while the Nifty can slowly reach towards 26400-26600. Nikkei and Shanghai can rise towards 51000-52000 and 4000-4100 respectively.
Crude prices have risen on geopolitical risks but face resistance. Brent and WTI are likely to see pullbacks towards $60–$58 and $56–$54 respectively. Gold remains strong after breaking above $4400 and can extend gains towards $4600–$4650. Silver stays bullish with scope to test $70–$71. Copper may remain range-bound between $5.6 and $5.3 until a breakout occurs. Natural Gas remains weak below $4.50 with downside risk towards $3.60–$3.50.
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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.
