Morning briefing: The Dollar Index has slightly inched lower

The Dollar Index has slightly inched lower but while it sustains above 98, the view remains intact to see a rise back towards 99.50 and higher. EURUSD & EURINR have risen further but the upside looks capped at 1.1750-1.1800 & 108-108.50 respectively. EURJPY & USDJPY can head towards 187-188 & 160-162 levels respectively in the near term. USDCNY is stuck between 6.98-6.96 region. Aussie can test 0.69 soon before getting peaked out. Pound is trading higher within its 1.330-1.355 range. USDINR is trading near 91.50 region on the NDF. Higher resistance is seen at 92.00–92.15, where the immediate upside is likely to be capped. Watch out for the BOJ meeting scheduled today wherein the Central Bank is expected to keep the interest rates steady at 0.75%.

The US Treasury yields remain lower. Support is there to limit the downside from here. Bias is positive for the yields to rise going forward. The US PCE, the Fed’s inflation gauge, data release yesterday did not have any impact on the yields. The PCE rose 2.77% (YoY) in November. The German yields remain stable around their resistance. A strong follow-through rise is needed to go up from here and avoid falling back. The 10Yr GoI has dipped further. Further fall is likely from here before the yield reverses higher again.

The Dow and DAX have moved up and can test 49500-50000 and 25000 respectively. Nifty has managed to hold above 25000 but needs a decisive break above 25600 for medium term bullishness. Nikkei and Shanghai can rise in the near term towards 54000-55000 and 4200 respectively.

Brent has dipped on peace talk signals but can remain range-bound between $63–$67 while above $63. WTI is holding near $59 and can trade within a $59–$62 range in the near term. Gold is moving up as expected and can test $5,000, needing a break above for further upside. Silver is also moving higher and can test the $99–$100 in the near term. Copper is holding above $5.8 and can bounce towards $5.9–$6.0 if support sustains. Natural gas remains bullish after the recent surge, with the near-term target still seen at $6.0.