Morning briefing: The US treasury yields have come down sharply

Vikram Murarka Kshitij Consultancy Services

The ECB kept rates unchanged but hinted at a December 2026 rate hike. EURUSD could rise towards 1.1250 if it sustains a move above 1.12 before reversing, while the Dollar Index could rebound provided support at 101.50–101.30 holds. Dollar-Yen may dip to 157 before bouncing towards 158+, whereas EURJPY is headed towards 177/178. EURINR could reach 107 if it sustains a rise above 106.60, while USDCNY is headed towards 6.65. The Aussie remains broadly bullish above 0.70, with near-term trading expected within 0.70–0.7070 before a breakout in either direction; the pound looks bullish towards 1.34/35. USDINR could rise gradually to 95.50, with a break above that level opening the way to 96.00.

The US Treasury Yields have come down sharply. The fall is happening first in line with our expectation. They can dip more to test their support and then resume the broader uptrend. The US PCE data release today will need a watch. The German Yields can also come down from current levels to test their support. Thereafter a fresh rise is possible. The 10Yr GOI is witnessing the corrective fall as expected. It has room to go down further from here.

Dow needs to sustain above 52000 for a rise towards 53000 or higher. DAX can extend towards 26500-26600 if it sustains above 26000, else it can pull back towards 25700 or lower. Nifty needs to break 23000 to extend towards 23200, else a pullback towards 22700 cannot be ruled out. Nikkei remains weak below 64000, with scope to decline towards 62000. Shanghai needs a decisive break below 3600 to move towards 3500.

Crude oil prices continue to extend gains, with Brent and WTI advancing toward $116 and $104 respectively. Gold remains under pressure and must defend $4000 support to prevent further drops toward $3900–$3800, while Silver has broken below $52 with room to fall toward $50. Copper has dipped below $6.60 and can decline toward $6.50 as anticipated. Natural Gas continues to consolidate within its $2.7–$3.2 trading range.

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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.

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