Morning briefing: The US Treasury yields have risen well

Vikram Murarka Kshitij Consultancy Services

Dollar index continues to rise but has to pause below 104.50 for scope to decline a bit. Euro is holding above 1.07 and while above 1.07, chances of a rise looks possible. USDCNY can rise to 7.08/09 before pausing. Pound and Aussie may pause and hold above 1.23 and 0.65 but overall view remains bearish for the medium term. EURJPY and USDJPY look bullish. USDRUB is stuck within the range of 78.95-81.00. EURINR has to hold above 88.50 to rise back else can decline further to 88. USDINR can trade within 82.60-83.00

The US Treasury yields have risen well. An extended rise looks likely from here. Outlook continues to remain bullish. The German yields are also bullish. There is room to rise more from here. The 10Yr and 5Yr GoI have resistances ahead that can cap the upside. Downtrend is intact and a fresh fall can be seen in the coming days.

Dow Jones and DAX remain lower. Nikkei is attempting to rise above the immediate resistance at 31000-31100. Shanghai sell off continues and looks likely to come down further in the near term. Nifty has bounced back sharply as the support at 18200 has held well.

Crude prices plunged yesterday on comments from Russian Deputy Prime Minister Novak, who said that he doesn't expect any fresh actions from OPEC+ and that the organisation would probably maintain current crude production targets at the June 4th meeting. Gold and Silver needs to hold above 1930 and 22.75 to avoid further downside risk. Copper sustains higher and may move up further to test 3.65/3.66.

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Author

Vikram Murarka

Kshitij Consultancy Services

Vikram has been forecasting, trading and hedging currencies since 1991. Beginning his career as a currency trader in Essar Group, he was managing an FX exposure of $1.2 bln.

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