STOCKS
Dow (24483.05, +1.21%) and Dax (12415.01, +0.98%) have moved up a bit yesterday but have important resistances just above current levels. Watch price action here. If the indices manage to break above immediate resistances, near term could see a decent upmove towards 25000 and 12800-12900 respectively.
Nikkei (21771.69, +0.51%) is almost stable but has some chances of moving up towards 22200-22400 in the near term before coming off from there again in the longer run
Shanghai (3170.10, -0.28, -0.25%) is trading below 3200 levels just now and could test 3150 once before again trying to move above 3200. Near term looks bearish.
Nifty (10458.65, +0.40%) has risen well yesterday also and has some chances of testing 10500-10550 on the upside. A short dip could be possible thereafter towards 10400 or lower in the longer term. Sensex (34101.13, +0.47%) has some scope of testing 34500 on the upside if the upside momentum sustains.
COMMODITIES
Brent (71.79) and Nymex WTI (66.85) are down a bit today. Some stable movement or a small corrective dip is likely to be seen after the recent surge in the last few sessions. Overall 68 on the WTI and 74 on Brent are likely to be tested and may hold for some more time.
Gold (1342.90) is slightly down again. While resistance near 1360/70 holds, it would not be easy for Gold to attempt a break above 1370. The price may continue to trade in the 1320-1370 region for now.
Copper (3.0680) saw a sharp fall from levels near 3.15. A bounce back from 3.02 is expected just now. Some stability may be seen in the prices for a few sessions.
FOREX
Dollar is seeing some strengthening due to a combination of various factors : US unemployment claims data coming in lower; Trump moderating his threat of a US attack on Syria and the US Fed minutes reflecting the FOMC’s firm belief in the US economy’s growth. On the other hand, the ECB minutes reflected some shakiness in the outlook for EU inflation’s sustainability, thereby weakening the Euro slightly.
Dollar index (89.79) is seeing a pause in its downmove towards support on daily candles and weekly line chart near 89.25. There 13 and 21 moving average lines on the 3 day line chart could provide resistance at current levels and push it down.
Euro (1.2327) has dipped from its high near 1.2396 day before yesterday and is testing support near 1.23 on 3 day candles and daily line chart. It is likely that this support will hold and push Euro up towards 1.24-1.2425 again (seen as immediate resistance on daily line chart). If Euro rises beyond 1.24-1.2425, it could then target previous highs near 1.26 (or max, go up to 1.28), from where a medium term correction could be possible. A straight rise past 1.26-1.28 would imply medium term bullishness for the Euro.
Dollar Yen (107.34), against our expectation of a dip towards 106.6 has risen to previous highs near 107.4. There could be some resistance at this level provided by the 21 moving average line on 3 day line chart and also by a possible trendline on daily candles and daily line chart coming down from Jan ’18. A breach of 107.4 would open up possibility of a further upmove towards 107.9-108.0, which is seen as a crucial level. A breach of this level would imply medium term bullishness for Dollar Yen.
Euro Yen (132.33), as mentioned yesterday, is getting some immediate resistance from the 21 moving average line on the 3 day line chart. Slightly higher up, there is the 21 week moving average near 133 on the weekly line chart which could also provide resistance. We could see 133 being tested if Dollar Yen stays in the 107.0-107.4 zone while Euro moves up towards 1.24.
Pound (1.4231) has breached immediate resistance near 1.42 (seen on daily and 3 day candles) and might now move towards interim resistance near 1.43-1.435 on 3 day candles. In the medium term, a breach of 1.430-1.435 could imply bullishness towards 1.46 (seen as resistance on weekly line chart).
Dollar Rupee (65.26) – We need to see whether the market closes above 65.20 or below 65.15 today. A Week Close above 65.20 increases the chances of a rise towards 65.50 over the coming weeks. Alternatively, a Week Close below 65.15 will increase the chances of a break below 65.05, targeting 64.80 all over again.
INTEREST RATES
US yields have seen a rise due to the positive developments listed in the Forex section above: US unemployment claims decreasing (thereby suggesting a stronger economy), Trump’s moderation on Twitter with respect to Syria and the Fed minutes reflecting increased belief in a stronger economy.
US 10 Yr Yield (2.8174%), 30 Yr (3.02%), 5 Yr (2.65%), 2 Yr (2.3357%):
The 10 Year yield, contrary to expectation, has moved higher towards resistance on short term chart near 2.83%-2.85%. It could see a dip soon.
The 30 yr as expected didn’t break support near 3% on short term and medium term chart and might dip from resistance near 3.03%-3.04% on short term charts.
