Morning briefing: EUR/USD bulls eye 1.1650 for next rally
The Dollar Index is trading near the lower end of its 100.50-99.00 range. A breach below 99 if seen can open the doors for 98 in the near term. EURUSD need to see a rise past 1.165 to bring higher levels into picture. EURINR can test 105-106 in the near term before getting peaked out. EURJPY & USDJPY can trade within 180-182 & 154-158 region respectively. USDCNY can fall towards 7.060 soon before rebounding. The Aussie has risen well but faces immediate resistance at 0.660-0.665 which can cap the upside for now. Pound is stuck within 1.32-1.33 region. USDINR can rise towards 90.00-90.25 in the near term. US ADP Employment, Industrial production & Capacity utilisation are some of the important data releases scheduled today.
The US Treasury yields sustain above their support. That keeps the near-term picture positive to move up to test their resistance. The price action around the resistance will need a close watch to see if the yields are extending their rise or falling back again. The German yields are holding higher. Bias is positive. The yields can rise more from here. The 10Yr GoI has come down sharply within the range. It can now test the lower end of the range. For now, we expect the sideways range to remain intact.
The Dow and Dax have risen slightly and could have scope to rise in the near term towards 48000+ and 24000+ levels. Nifty needs to hold above the immediate support to rise back to 26200-26400 else can decline sharply towards 25800/600. Nikkei could trade within 51000-48000 for a while. Shanghai can remain subdued while below 4000 and can continue to hold within 4000-3800 region for now.
Brent and WTI have slipped and may test support at $61 and $58 respectively. Gold retains above $4200 and can rise towards $4400. Silver keeps its bullish momentum with room to stretch toward $60–$62. Copper stays positive while above $5.2, keeping the door open for a climb toward $5.5–$5.6. Natural Gas remains poised for a rise towards $5.25–$5.50 before any potential reversal.
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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.
