Morning briefing: EUR/USD may rise towards 1.1500-1.1600
The Dollar Index below 101-100 can fall to 98-96. The Euro on a break past 1.14 can ascend towards 1.15-1.16 levels. EURINR needs to sustain 97 to test 98-99 levels. EURJPY continues to trade within the 165-160 region. USDJPY has been coming off and can fall towards 142 or even 140 before halting. AUDUSD and Pound are trading within the range of 0.6550-0.6400/635 and 1.36-1.34 respectively. The USDCNY needs to see a break past 7.2250 to negate the fall to 7.17/15. A break below 7.19 can confirm the anticipated fall. The USDINR can hold the range of 855-86 for a while. IN Manufacturing PMI and US ISM Manufacturing data releases are scheduled today.
The US Treasury Yields fell on Friday but has bounced back slightly in the early Asian session today. They have to get a strong follow-through rise above the immediate resistance in order to move higher. Else there are good chances to see more fall this week. The German Yields remain lower. They have room on the downside to test their support. The price action thereafter will need a watch to see if they are bouncing back or not. The 10Yr GoI has risen back sharply. But resistance ahead can cap the upside and keep the broader downtrend intact.
The Dow is headed towards 42500-43000 within a broad trade range of 41000-43000 while Dax needs to sustain trade above 24000 to move higher towards 25000 else can fall to 23500-23000 region. Nifty can trade within 24400-25100 while above support at 24500/400. Nikkei could trade with a bearish bias while below 38000 and could have fair scope for a decline towards 36500-36000 soon. Shanghai is likely to continue trading between the 3400-3340 region for the near term.
Crude prices dropped last week on OPEC+ production fears, though both are rebounding with resistance levels near $66 and $64, respectively, below which further declines are possible. Gold faces strong resistance around $3,350, potentially pulling it down to $3,250–$3,200 unless it breaks higher. Silver remains weak below $34, likely trading between $34 and $32. Copper surged today with a near-term target of $4.9–$5.0. Natural Gas is holding above $3.5 with resistance at $3.6–$3.7, and a potential fall towards $3.4–$3.3 if resistance holds.
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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.
