STOCKS
Global indices looks mixed in the near term. The bias remains bullish. But a sideways consolidation is possible in the near term before we see fresh rallies in them. The Indian indices, Sensex and the Nifty 50 continues to look stronger than the global equities and can move further higher to revisit the record highs in the coming days.
Dow (25962.51, +216.84, +0.84%) remains mixed and has been oscillating around the 21-day moving average (25817) over the last few days. A range-bound move between 25650 and 26125 is possible for some time. A breakout on either side of 25650 or 26125 will decide the next move.
DAX (11549.96, -53.93, -0.46%) has come-off in the last couple of days after testing 11800. Support for it is at 11450 which can be tested in the near term. A bounce thereafter can take the index higher again to 11600 and higher levels.
Nikkei (21563.09, -45.83, -0.21%), though stuck in a narrow range over the last few days, is managing to sustain above the 21-day moving average support level of 21470. This keeps the bullish bias intact for a rise to 21900-22000 in the short term.
Shanghai (3068.37, -33.08, -1.07%) continuing to hover near 3100. The index seems to be waiting for some trigger to breach 3100 and rally to 3150-3180.
Sensex (38386.75, +23.28, +0.06%) and Nifty (11521.05, -11.35, -0.10%) which were closed yesterday on account of public holiday are likely to open positive today. Sensex is likely to breach 38500 and target 39000 in the coming days. Support for it is in between 38150 and 38000. Nifty 50 can surge to 11700-11750 while it sustains above 11500.
COMMODITIES
Gold and Silver is turning bullish in the near term and could see some further upticks in the coming sessions. Copper continues to consolidate within its uptrend. Brent continues to trade mixed with a bullish bias. WTI looks relatively more positive than Brent and can move higher in the near term.
Gold (1309) and Silver (15.48) has come-off sharply after testing 1320 and 15.63 respectively. However, the bias remains bullish. Gold has cluster of supports between 1305 and 1300. Gold can revisit 1320. An eventual break above 1320 can then take it further higher to 1330-1333. Silver on the other hand can test 15.7 on a decisive break above 15.55
Copper (2.91) spiked to 2.97 and has come-off from there. The 2.88-2.95 sideways consolidation is likely to continue for some more time. The bias however continues to remain bullish for copper to break 2.95 and test 2.98 and 3.0.
Brent (67.75) has been struggling to breach the resistance around 68.50 over the last few days. But as long as it sustains above 67, the chances are high of it to break 68.5 and target 70 in the coming days. Supports below 67 are at 66.6 and 66.15.
WTI (59.9) has risen above the key resistance at 59.5 and continues to trade stronger than Brent. While above 59.5, an upmove to 61.2 and 61.8 is possible in the near term.
FOREX
Dollar-Index (96.33) saw a sharp fall to 95.75 yesterday after the FED reaffirmed its dovish policy stance. The FED also mentioned that the unwinding of its balance sheet would end in September. Although the index is trading higher just now, there is scope of testing 95.25 on the downside before again rising back to higher levels above 96.50.
Euro (1.1374) has come off from 1.1450 in the last 2-sessions and could possibly fall to test 1.1340-1.1330 levels just now. Thereafter, if the pair does not break below 1.13 immediately, we could see another attempt of rising towards 1.1450 or higher.
Euro-Yen (125.94) has fallen as expected. A test of 125.20 is on the cards for the next 1-2 sessions. Thereafter, we need to see if the pair bounces back from 125.20 or falls below to initiate further bearishness.
Dollar Yen (110.73) has clearly broken below 111 and could target 110.0-109.5 in the near term.
Aussie (0.71) is headed towards resistance at 0.72 and could face rejection from there which could push Aussie towards 0.71 again in the near term.
Pound (1.3141) tested support at 1.30 yesterday and has opened with a gap up. It could move up in the next few sessions targeting 1.32-1.33 again.
USDCNY (6.70) could move up to test 6.7330 in the near term before coming down from there sharply. Overall medium term charts show possible strength in the Yuan towards 6.65 or even lower.
Dollar-Rupee (68.83) could test 68.70/60 on the downside. Overall trade today is expected to be below 69. Next week could possibly see a bounce back to levels above 69, targeting 69.50.
INTEREST RATES
The US yields have fallen sharply contrary to our expectation of a rise. The 2YR (2.40%), 5Yr (2.33%), 10Yr (2.53%) and the 30YR (2.96%) are trading lower. Near term looks bearish while the yields may continue to fall over the next few sessions before a corrective upmove is seen.
The German-Japan 10Yr spread (0.11%) has dipped and could fall further towards 0.08% in the near term. This could pull down EURJPY also.
The US-JGB 10Yr (2.59%) is also trading lower and could fall to 2.47% in the near term.
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