Vikram Murarka
Kshitij Consultancy Services
The Dollar Index surged yesterday to 102.09 possibly as safe haven amidst the escalating tensions in the Middle East. The index needs to sustain above 102 to continue moving up, else can fall back towards 101-100.50 again. Euro is headed towards 1.10 which needs to sustain to prevent a further dip to 1.0950/1.09. USDJPY and EURJPY could remain below 150 and 164 respectively. Aussie can be ranged from 0.6850-0.68. Watch price action at 0.68 for a bounce or break below from there. The pound saw a significant fall yesterday led by the dovish comments from the BoE Governor. EURINR may trade within 94-92.50/92. USDINR can test 84-84.10 in the near term before facing rejection. Watch US NFP and Unemployment data to be released today.
The US Treasury yields have and come close to their resistances. While the broader trend is down, a break above the immediate resistances can trigger an extended rise before the downtrend resumes. The US Unemployment data release today will be important to watch. If the Unemployment rate (4.2%) goes up from here, it can be negative for the yields. The German yields have bounced. But resistances are there to cap the upside and keep the downtrend intact. The yields have room to fall more. The 10Yr GoI is moving up in line with our expectation. The yield can rise further from here.
Dow Jones is headed towards support near 41700/600 which if holds can produce a bounce back towards 42800/43000 in the medium term. Dax is falling as expected. If it bounces from 18900/800, it can resume upmove towards 19000/20000. Nifty has plunged below 25500 contrary to our expectations. It can test 25000 before pausing there. Nikkei is rising well and could target 39000/40000 while above 37500/38000. Thereafter, a dip can be seen from 40000 in the medium term. Shanghai is closed till 7th October.
Crude prices rose significantly amidst the escalation in conflict in the Middle East, with concerns that Iran and Israel may be on the cusp of a full-blown war. Brent can rise further towards 78-80 while WTI can target 76-77 on the upside. Gold, Silver and Copper looks ranged for the near term between 2700-2640, 32.5-30.50 and 4.5-4.8 respectively. Natural Gas looks bearish towards 2.7-2.6 while below resistance at 3. A break above 3, if seen can extend it to 3.2 before the expected decline is seen.
Visit KSHITIJ official site to download the full analysis
The above views are based on the latest available information. Though the information sources are believed to be reliable, the information is not guaranteed for accuracy. While the views are proffered with the best of intentions, neither the author, nor the firm are liable for any losses that may occur as a result of any action based on the above. 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.
Recommended Content
Editors’ Picks
EUR/USD extends recovery beyond 1.0400 amid Wall Street's turnaround
EUR/USD extends its recovery beyond 1.0400, helped by the better performance of Wall Street and softer-than-anticipated United States PCE inflation. Profit-taking ahead of the winter holidays also takes its toll.
GBP/USD nears 1.2600 on renewed USD weakness
GBP/USD extends its rebound from multi-month lows and approaches 1.2600. The US Dollar stays on the back foot after softer-than-expected PCE inflation data, helping the pair edge higher. Nevertheless, GBP/USD remains on track to end the week in negative territory.
Gold rises above $2,620 as US yields edge lower
Gold extends its daily rebound and trades above $2,620 on Friday. The benchmark 10-year US Treasury bond yield declines toward 4.5% following the PCE inflation data for November, helping XAU/USD stretch higher in the American session.
Bitcoin crashes to $96,000, altcoins bleed: Top trades for sidelined buyers
Bitcoin (BTC) slipped under the $100,000 milestone and touched the $96,000 level briefly on Friday, a sharp decline that has also hit hard prices of other altcoins and particularly meme coins.
Bank of England stays on hold, but a dovish front is building
Bank of England rates were maintained at 4.75% today, in line with expectations. However, the 6-3 vote split sent a moderately dovish signal to markets, prompting some dovish repricing and a weaker pound. We remain more dovish than market pricing for 2025.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.