Morning briefing: Dollar Index needs to decisively break below 107.00 to turn bearish

Dollar Index needs to decisively break below 107 to turn bearish. Else, while it holds above 107.70, it can attempt to rise back towards 108.50 again. Euro needs to see a strong break past 1.0450 to bring 1.05/06 into picture. Immediate support at 1.0350. EURINR its trading higher within its broad range of 89-91. USDJPY and EURJPY if sustained, can are rising towards 155/56 and 162/64 respectively. AUDUSD and Pound can remain ranged within 0.6150-0.6350 and 1.23-1.26 respectively in the near term. USDCNY on a strong break past 7.30, can test 7.35 on the upside. USDINR above 86.50, can extend the rise towards 87.00-87.15 in the near term. US PPI data release is scheduled today.

The US Treasury yields have risen sharply after the inflation data release yesterday. A follow-through rise is needed from here to go up further. Else they can fall back. We will have to wait and watch. The US Headline CPI rose 3% (YoY) in January, up from 2.87% in December. The Core CPI increased by 3.29% in January, up from 3.21% a month ago. The German yields have risen further. The chance of the fall is getting reduced. The yields can rise further from here. The 10Yr GoI remains stable within the range.

The Dow Jones initially fell to a low of 44104.48 before recovering above 44300 and holding the range of 44000-45100. A break below 44000 would confirm the double top formation and pull the index down to 43000. DAX has risen above 22100. Further, a follow-through rise would take the index higher to 23000. Nifty tested the support of 22800 by dropping down to 22798.35 before moving higher and closed above 23000. Further, Nifty needs a rise past 23300 to negate the risk of seeing a fall towards 22500. Nikkei has moved up above 39000 and is heading towards 40000. Shanghai has risen to 3350. Further, while this rise is sustained, extended gains towards 3400-3420 can be seen.

Crude prices have dipped from respective resistances as expected and could dip some more in the near term. Gold seems to be ranged for now and can trade within 3000-2850 region for sometime while Silver can rise to 33-33.50 while above 31.50. Copper has regained the earlier losses seen during the week and is poised to move up again targeting 4.7-4.8. Natural Gas is steadily rising as expected and could head towards 3.8-4.0 soon.

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