Thu, Sep 29, 2022 @ 09:08 GMT
HomeContributorsTechnical AnalysisMarket Morning Briefing: Dollar Yen Has Seen A High Near 111.07

Market Morning Briefing: Dollar Yen Has Seen A High Near 111.07

STOCKS

Dow (24715.09, +0.0045%) is stuck near 24700 for the last few sessions. Resistance on the daily candle chart near 25200 is holding well for now. There could be some scope of testing lower levels of 24400 or even lower in the medium to long term while 25200 holds.

Dax (13077.72, -0.28%) continues to remain within the near term uptrend. 13000 is the immediate support which could push the index to higher levels of 13200-13400 in the coming sessions.

Nikkei (23037.90, +0.47%) is also trading along the channel support on the daily candles. An eventual rise towards 23400 or higher looks possible in the medium term.

Shanghai (3214.04, +0.65%) after coming off from resistance near 3200 once again rose up sharply today and is trading above the 3200 levels. If the index manages to sustain the current rise, we may negate a fall towards 3100 or lower in the coming sessions and instead see the index targeting an upside of 3250.

Political tensions over the Karnataka elections are moving the Indian equities just now. With news of Yedurappa resigning on Saturday and the BJP skipping the floor test, the impact on the Nifty could be negative. Nifty (10596.40, -0.81%) did come down slightly on Friday and could continue to move down today also. Immediate downside target is 10500-10000 levels.

COMMODITIES

Brent (79.05) and Nymex WTI (71.89) could see some near term short dip towards 77 and 70.50 respectively before attempting another rise. Some stability could be expected just now near current levels.

Gold (1288.70) is almost stable near current levels. A fall below 1275 is not expected just now and instead the price could rise towards 1300 again in the near term.

Copper (3.0845) has support near 3.05 and while that holds, there could be chances of a bounce towards 3.15 in the medium term. Overall immediate view is bullish.

FOREX

Dollar index (93.79) saw a high near 93.8 on Friday and is continuing to trade near those levels. A dip, if it happens, might be restricted till 93.4-93.5 (support on daily candles). There are good chances of the Dollar Index testing its upside target near 95 in this week or max by next week. We have been saying that the upside is likely to be capped till 95. The 89 weeks MA near 95.65 is a possible extension level which should produce a dip, if tested.

Euro (1.1753) could test 1.155 as the Dollar Index tests levels near 95. The 89 weeks MA for the Euro which could produce a bounce is near 1.145. Any upward correction during the week might be restricted till 1.18 (downward channel on daily candles).

Dollar Yen (111.03) has seen a high near 111.07 and is trading near those levels currently. As mentioned on Friday, the revised upside target would be levels near 112, which corresponds with crucial long term resistance on weekly candles. In this week, it could first rise a little more towards 111.50, then see correction towards 111.00-110.75 and then rise back again towards 112 by next week possibly.

Euro Yen (130.49): After having bounced from support on 3 day candles near 129.5 last week, it looks like it could test resistance on daily candles near 131.5 in this week. However, individual forecasts on Euro and Yen present a slightly different possibility – with Euro headed downward towards 1.155 and Dollar Yen’s upside capped till 112, Euro Yen might dip towards support near 129 again very soon.A dip towards 129 is hence preferred in this week.

Pound (1.3453): As mentioned on Friday, Pound could possibly see a phase of ranging between the levels 1.345 and 1.36 (possibly extending upto 1.37). It has been trading near 1.345 in the last couple of sessions (seen as support on daily and 3 day candles). If it breaks this support, our forecast of ranging movement would be proven incorrect and it would turn bearish again.

Dollar Rupee (68.0050): While some steady movement within the 67.50-68.30 region is possible in this week, there is also a possibility of a sharp rise towards 69, sooner than the markets are expecting. It needs to be seen if the Karnataka outcome on Saturday leads to any volatility today.

INTEREST RATES

US yields saw an important rally last week in which the 10 Year yield finally rose past the 3% level decisively. We now expect this rally to possibly continue in the near term towards the following upside targets:

3.2%-3.3% (10 Year), 3.4%-3.5% (30 Year), 3.15% (5 Year) and 2.56% (2 Year)

US 10 Yr Yield (3.06%), 30 Yr (3.20%), 5 Yr (2.90%), 2 Yr (2.57%):

The 10 year yield looks like it could dip slightly more towards 3.04%-3.05% to test support on short term charts and then rise again.

The 5 Year yield is near support and could rise towards 2.94%2.95% again in the next couple of sessions.

The 30 year yield could also see its downside restricted till 3.20%.

Kshitij Consultancy Service
Kshitij Consultancy Servicehttp://www.kshitij.com
These views/ forecasts/ suggestions, though proferred with the best of intentions, are based on our reading of the market at the time of writing. They are subject to change without notice.Though the information sources are believed to be reliable, the information is not guaranteed for accuracy. Those acting in the market on the basis of these are themselves responsibly for any profits or losses that might occur, without recourse to us. World financial markets, and especially the Foreign Exchange markets, are inherently risky and it is assumed that those who trade these markets are fully aware of the risk of real loss involved.

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