Morning briefing: The US Treasury yields remain stable

The DXY tested 98 before coming off from there. Failure to hold and rise back above 98 could drag the index down towards 97-96.50. Euro on the other hand is holding well above 1.17 and has fair scope for a rise to 1.1850/1.19 while above 1.1750. EURINR is slowly rising towards 108-108.50 while above 107. EURJPY has immediate resistance at 185-185.35 while USDJPY has already tested 156.823, breaking above our mentioned resistance at 186 but has declined back today. If EURJPY and USDJPY holds below their respective resistances, a fall towards 183 & 154/152 can be possible. USDCNY has broken below the crucial support at 6.85 and if the fall sustains, it can soon test 6.80/70. The Aussie and Pound can rise towards 0.71-0.7150 and 1.36-1.3650 respectively. USDINR closed at 90.9525 yesterday. If it holds below 91, a dip back towards 90.50 can be possible else, a rise to 91.25/50 could come into the picture.

The US Treasury yields remain stable. It remains vulnerable to fall further from here before a reversal is seen. The German Yields remain lower and stable. They have room to fall further from here to test their support. The price action thereafter will need a close watch. The 10Yr GoI has good support which can limit the downside from here. We expect the yield to rise eventually after testing its support.

Dow has moved up but remains below 49,750, keeping the downside risk open towards 48,500–48,000. DAX has bounced back and is likely to stay range-bound between 25,400-25,000 for now. Nifty failed to sustain higher levels and, while below 25,800, can drift lower towards 25,000–24,900. Nikkei surged sharply but faced resistance near 60,000, though the broader rally can extend towards 60,500–61,000. Shanghai moved up as expected and the ongoing rally can extend further towards 4,185–4,200.

Brent and WTI are struggling and may test supports near $70–$69.50 and $65–$64.50 respectively. Both can later bounce back towards $74–$76 and $68–$70 in the coming sessions. Gold remains firm with upside intact towards $5,300–$5,400 in the near term. Silver is rising as expected and can edge higher towards $90. Copper has risen as expected with scope to extend gains towards $6.10–$6.20. Natural gas remains weak and may decline further towards $2.80–$2.60.