Morning briefing: Euro can trade within 1.0650 – 1.0750

Good Morning!

The Dollar Index and Euro can trade within 106.50-105/104 and 1.0650-1.0750/08 respectively while Dollar-Yen and EURJPY are bullish towards 162 and 173/174. Aussie & Pound have risen well but remain within the sideways range of 0.6580-0.6720 and 1.26-1.28 respectively. USDCNY is nearing our target of 7.28 from where an initial dip looks possible. EURINR has risen well over the last 2-sessions but can trade within 89-90 region for some time while below 90. USDINR can continue to trade within its range of 83.30-83.67 in the near term.

The US Treasury yields have dipped slightly after the Fed Chairman Powell’s comment stating that the central bank is satisfied with the progress in the inflation but will still wait to begin the rate cut process. The yields have room to rise from here before reversing lower again. The German yields remain higher and are bullish to see more rise. The 10Yr and 5Yr GoI remain stable. They have room to rise from here while they sustain above their immediate support.

Dow Jones is stuck in a narrow range but has scope to see a breakout on the upside. DAX has fallen within its sideways range. A break on either side of the range is needed to get more clarity on future direction. Nifty lacks a strong follow-through rise above 24200. Need to see if breaks above 24200 or falls below 24000. Nikkei has bounced back sharply and may look to rise towards its key resistance before a pause can be seen. Shanghai has dipped failing to rise past 3000, but has near term supports which may hold and lead to a rise an eventual rise above 3000.

Crude prices have dipped a bit but have immediate supports which may hold and lead to an eventual rise towards their key resistance in the near term. Gold, Silver and Copper have resistance overhead, which if holds, can lead to a fall back in the near term. Natural Gas remains subdued and looks bearish to fall further from here.

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