Morning briefing: The US Treasury yields remain lower and stable
Dollar Index is recovering towards 101, pressuring EURUSD towards 1.14/1.1370. EURINR holds below 111, while USDJPY stays bullish above 161.50 to target 163/165. EURJPY needs a break past interim resistance at 186.32 to rise towards 188 while USDCNY needs to hold above 6.77 for 6.78-6.7850. Aussie and Pound look weak while below 0.70 and 1.3550 while USDINR may face resistance near 96.50-96.75.
The US Treasury Yields remain lower and stable. Support can limit the downside and keep the upside open to see more rise going forward. The German Yields have inched up. The bullish view remains intact. They can rise more. The 10Yr GoI has dipped further. Failure to rise back immediately can drag it lower from here.
Dow and DAX are likely to stay within the 52000-53000 and 24800-25500 ranges respectively. Nifty continues to hold above 24000, but a break below this level could drag it towards 23800, keeping the broader 23800-24400 range intact. Nikkei has turned sharply weaker and can decline further towards 62000-60000. Shanghai has broken below 3900 and can extend its decline towards 3800 before a possible rebound.
Brent and WTI can rise further towards $90 and $85 respectively. Gold is testing the crucial $4000 support, and a sustained break below this level could trigger a decline towards $3800-$3600. Silver is likely to remain range-bound between $55 and $65. Copper could find support near $6.00 and recover towards $6.50. Natural Gas remains weak and can decline further towards $2.85-$2.80.
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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.
