Morning briefing: The US treasury yields hold higher

Vikram Murarka Kshitij Consultancy Services

Dollar Index continues to look weak towards 98.50/98.00 while Euro can rise in the coming sessions towards 1.17 or higher. Aussie and Pound have risen well, while Dollar-Yen may stay capped below 160 for the very near term. EURINR and EURJPY look bullish toward higher targets of 112.50 and 186-188 while USDCNY remains weak heading towards 6.70. USDINR is likely to stay range-bound below 95.80 for now but medium term looks unclear at the moment.

The US Treasury Yields hold higher. The bullish view is intact to see more rise going forward. Any intermediate dips can be short-lived as supports are there to limit the downside. The German Yields sustain higher but remain stable. The view remains bullish for the yields to rise further from here. The 10Yr GoI has dipped. The upside remains open to see higher levels before the broader downtrend resumes.

Dow has bounced from 52800 and can rise towards 53500-54000, while DAX can move towards 26250-26500 above 26000. Nifty remains positive above 24100 and can rise towards 24300-24400. Nikkei remains vulnerable below 66000, with downside towards 64500-64000, while Shanghai has broken below 3900 and can decline towards 3850-3800.

Latest developments remain focused on Middle East supply risks, with stalled US-Iran talks and expected US sanctions on Iran keeping oil markets volatile. Brent and WTI are likely to remain range-bound within $80-$95 and $75-$90 respectively until a breakout provides further direction. Gold remains bullish above $4200 and can rise further towards $4650-$4700, while Silver can advance towards $70-$75. Copper remains positive and can rise towards $6.65-$6.75. Natural Gas has dipped but can move towards $2.80 and higher in the coming sessions.

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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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