STOCKS
Global equities remain broadly positive with a chance to dip from current levels in the near term before moving further higher. Shanghai looks much stronger among all and could be gearing-up for fresh rally in the coming weeks.
Dow (26258.42, +329.74, +1.27%) has risen breaking above the resistance at 26060 mentioned yesterday and has closed around the next resistance level of 26250 . A pull-back from current levels to 26000 cannot be ruled out. But as long as Dow remains above 26000, the outlook is bullish for a rally to 27000 and 27250.
DAX (11681.99, +155.95, +1.35%) has breached its resistance at 11542 and is heading towards 11720 as expected. A decisive break above 11720 will pave way for a test of 11900.
Nikkei (21561.01, +51.98, +0.24%) has resistance at 21640 which if holds can drag it to 21400 in the near term . But an eventual break above 21640 will see the index targeting 21900 and 22000.
Shanghai (3181.15, +10.79, +0.34%) is giving confirmation of the resumption of its uptrend. Support for the index is at 3120. As long as it trades above this support a rally to 3250 and 3280 is possible in the coming weeks.
Sensex (38871.87, +198.96, +0.51%) has failed to get strong follow-through buyers above 39000 yesterday. A decisive close above 39000 is needed to boost the momentum and take the index to 39500 and higher levels. While below 39000, a dip to 38500 cannot be ruled out.
Nifty 50 (11669.15, +45.25, +0.39%) has come-off from the day’s high of 11738. An intermediate dip to 11550 looks likely before we see a rally to 11800.
COMMODITIES
Gold and Silver may consolidate in the near term while copper has to break a key resistance to move higher. Oil has broken its key resistance and is likely to move higher.
Gold (1283) fell to a low around 1283 and has bounced slightly from there. If it consolidates between 1280 and 1290 as was seen in early March, then a bounce to 1300-1305 cannot be ruled out going forward. A strong break below 1280 is needed to renew the downside pressure and drag it to 1275 and 1270.
Silver (15.10) can remain range-bound between its support at 15 and resistance at 15.2 for some time. A breakout on either side of 15 or 15.2 will then decide the next move.
Copper (2.93) spiked to 2.99 and has come-off sharply from there. Supports are at 2.92 and 2.90. Resistance is at 2.97, a strong close above which is needed to target 3.02 and 3.05 level in the short term.
WTI (61.85) has risen as expected and is closer to the level of 62 mentioned yesterday. Key resistance is in between 62 and 62.30, a strong break above which can take WTI further higher to 63.5 and 64.
Brent (69.3) has risen breaking above 68.5. An immediate resistance is in between 69.7 and 70. A strong break above it can pave way for a test of 72 and 72.5 in the short term. The region between 68.5 and 68.35 will now act as a good support.
FOREX
Dollar-Index (97.33) fell towards 97 but managed to bounce back from there without continuing to fall below 97. While 97 holds, Dollar Index could move up to test 97.75 on the upside. Near term looks bullish.
Euro (1.1203) has come down to test immediate support at 1.12. Break on the downside could extend the current fall towards 1.11 which is an important medium term support and could push the pair back towards 1.1250-1.1300 levels in the longer run.
Euro-Yen (124.70) is trading lower. 125.20 is an interim resistance and above that at 125.40 there is 21-day Ma which may act as a decent resistance too in the near term. A break above 125.40 is needed for a rise towards 126.80; else a fall back to levels near 123.60 could be possible. Movements are narrow and small just now.
Dollar Yen (111.32) is headed towards immediate resistance near 111.5 and 112.0 respectively which could hold and produce a rejection back to 110 in the near term.
Aussie (0.7105) also has resistances near 0.7150 and 0.72 respectively which could hold in the near term. Only on a break above 0.72 would we turn bullish towards 0.73 or higher. For now we prefer a rejection from 0.72-0.7150 levels.
Brexit proposal was again rejected in the indicative vote yesterday. Despite that the Pound (1.3071) rose yesterday as the manufacturing PMI levels came out higher than expected. Although Pound looks weak in the longer run, we could see a near term bounce in Pound towards 1.3150.
USDCNY (6.7202) has immediate support at 6.70 which if holds could push the pair back towards 6.74 in the near term. A break below 6.70, if seen could turn bearish where the Yuan could strengthen towards 6.68-6.67 levels.
Dollar-Rupee (69.16) could see a fall towards 69 or lower today after the RBI announced another 3-yr FX Buy/Sell Swap auction scheduled on 23rd April for $5 bln. While this would bring down the forward premia lower, we could see some strength in Rupee as well.
INTEREST RATES
The RBI announced another 3-yr USDINR Buy/Sell swap auction scheduled on 23rd April. This would be for $5 bln with an aim to infuse Rupee liquidity into the system. The forward premia for 6mnth (4.11%) and 12 mnth (3.78%) is likely to see a dip towards 3.90% and 3.65% or lower.
RBI bi-monthly policy meet is due on 4th April and announcement of the swap auction prior to the policy meet is indicative that RBI is in favor of keeping the interest rates lower.
The 10YR GOI (7.4858%) could possibly attempt a break below 7.45% today.
The German-Us 10YR (-2.5%) is headed towards support near -2.55% and while that holds and produces a bounce, Euro could be bullish for the medium term. While the spread falls euro is likely to test 1.11.
The US-JGB 10YR (2.55%) is sharply rising and looks bullish for the near term, in line with a rise n the Dollar-Yen towards 111.50-112.00 mentioned in the FOREX section above.
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