Morning briefing: Pound is nearing the support around 1.3300-1.3270

Vikram Murarka Kshitij Consultancy Services

The Dollar Index needs to breach 99.50 to head towards 100-101 levels. Else, the pullback towards 98-97 looks likely. Euro is currently holding well the support near 1.1570-1.1550 region. Whether the pair will trade within 1.1550-1.1700 region or will it extend the fall to 1.15/14 region will have to be seen. On a break below 101.50 EURINR can get dragged towards 101-100. EURJPY & USDJPY can target 178-180 & 153-154 in the near term. USDCNY continues to consolidate between 7.12-7.14. The Aussie continues to stay within 0.655-0.645 range for now. The Pound is nearing the support around 1.3300-1.3270. Need to see whether the pair bounces back from the support or extends the fall further. USDINR is trading near 87.70 on the NDF and if the spot opens below 87.75 in the onshore then USDINR can get dragged towards 87.50 or even 87.00 in the coming weeks.

The US Treasury yields have bounced well. Some more rise is possible before the yields resume the fall. The German yields remain lower and stable. They have room to fall more to test their support. The 10Yr GoI has risen well but well within its range. A range breakout is needed to get clarity on the next direction of move.

The Dow, Dax and other Asia-Pac indices have risen after a long awaited announcement of a meeting between Trump and Xi Jinping next Thursday in Asia. The Dow is headed towards 47000 while the Dax can rise towards 24500-25000. Nifty is inching higher towards 26000. Thereafter whether the index would face rejection or break higher will have to be seen. Nikkei can test 50000. Thereafter a break past 50000, if seen can open up doors for 52000. Shanghai is headed towards 4000, a break past which if seen can take it towards 4200 eventually.

Crude prices surged after new US-EU sanctions on Russian energy, with Brent rising to $66.36 and WTI to $62.20, both eyeing further gains towards $68 and $64 respectively. Gold and Silver rebounded strongly, targeting $4200-4250 and $49-50 as long as supports at $4000 and $46.50 hold. Copper touched $5.1185, facing resistance near $5.15, with potential for a breakout towards $5.25-5.30. Natural Gas fell to $3.29 after a higher storage build, with chances of extending the decline to $3.20-3.00.

Visit KSHITIJ official site to download the full analysis

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.

EUR/USD keeps the rangebound trade near 1.1850

EUR/USD is still under pressure, drifting back towards the 1.1850 area as Monday’s session draws to a close. The modest decline in spot comes as the US Dollar picks up a bit of support, while thin liquidity and muted volatility, thanks to the US market holiday, are exaggerating price swings and keeping trading conditions choppy.

GBP/USD trades with negative bias, eyes 1.3600 ahead of UK jobs data

The GBP/USD pair trades with a negative bias for the second straight day, though it lacks bearish conviction and holds above the 1.3600 mark through the Asian session on Tuesday. Traders now look forward to the release of the UK monthly jobs report, which will influence the British Pound and provide some impetus to the currency pair.

Gold sticks to a negative bias below $5,000; lacks bearish conviction

Gold remains depressed for the second consecutive day and trades below the $5,000 psychological mark during the Asian session on Tuesday, as a positive risk tone is seen undermining safe-haven assets. Meanwhile, bets for more interest rate cuts by the Fed keep a lid on the recent US Dollar bounce and act as a tailwind for the non-yielding bullion, warranting caution for bearish traders ahead of FOMC minutes on Wednesday.

AI Crypto Update: Bittensor eyes breakout as AI tokens falter

The artificial intelligence (AI) cryptocurrency segment is witnessing heightened volatility, with top tokens such as Near Protocol (NEAR) struggling to gain traction amid the persistent decline in January and February.

US CPI is cooling but what about inflation?

The January CPI data give the impression that the Federal Reserve is finally winning the war against inflation. Not only was the data cooler than expected, but it’s also beginning to edge close to the mystical 2 percent target. CBS News called it “the best inflation news we've had in months.”

XRP steadies in narrow range as fund inflows, futures interest rise

Ripple is trading in a narrow range between $1.45 (immediate support) and $1.50 (resistance) at the time of writing on Monday. The remittance token extended its recovery last week, peaking at $1.67 on Sunday from the weekly open at $1.43.