Kshitij Consultancy Services
Morning Briefing Daily forecasts on global Stocks, Commodity, Forex and Interest Rates markets
27 Jul 17. 0857 IST or 0327 GMT or 2327 EST
GOOD MORNING!
STOCKS

Dow (21711.01, +0.45%) rose above 21700 yesterday indicating resumption of the long term uptrend and has enough room on the upside towards 21800 for the coming sessions. Near term is likely to remain bullish.

Dax (1235.11, +0.33%) could test 12400-12450 in the coming sessions before seeing another down leg.

Shanghai (3221.92, -0.79%) came off sharply as expected and could fall further towards 3200 before again rising towards 3240-3260 levels.

Nikkei (20093.41, +0.22%) has been stable in the past 6-7 weeks and could continue to trade within 19705-20000 region for the next couple of weeks.

Nifty (10020.65, +0.56%) moved up yesterday to close above 10000. Immediate resistance is visible near 10050-10100 from where a sharp correction is possible in the medium term.

COMMODITIES

The support of 1245 held for Gold (1260) due to fresh weakness in Dollar index (93.22). Immediate trading range for Gold is 1258-1270. Gold is overbought in near term time frame and we are not confident about the sustainability beyond 1270 regions. Similarly Silver (16.69) is also trading within 16.69-17, well supported by the bullish momentum in Copper. Both Gold and Silver are out of their short term bearish channel but the supports of 1245 and 16.20 should hold to keep the bullish momentum intact.

Copper (2.86) looks on a firm footing while it is trading above 2.78 levels. Midterm resistance comes at 3.12 regions from where we may see some correction due to profit taking.

Both Brent (50.88) and WTI (48.66) moved upward as U.S weekly crude inventory data (actual -7.2M B) was highly supportive for the entire energy pack. This is the 5th consecutive week of shortage in weekly U.S crude inventory. We will remain bullish while Brent and WTI are trading above 47.70 and 45.50 on a weekly closing basis. Immediate trading range for Brent and WTI could be 48-51.50 and 46-49.70 respectively and a weekly close above51.50 and 49.70 levels might confirm the end of the midterm bearish trend too.

FOREX

Further strength in Euro to 1.1744, breaking above the earlier crucial resistance at 1.1712. This surge opens up targets of 1.18-20.

Dollar-Yen has come down again all the way to 110.98, giving back almost all the gains up to 112. Supports seen at 110.50 and deeper at 110.00.

The Euro-Yen (130.26) looks poised to climb further towards 132, possibly led by Euro. Dips likely to be bought.

Strong surge in Pound (1.3144) and Aussie (0.8044). f the Pound sustains above 1.31 today, look for a test of 1.32, beyond which 1.34 will come into the picture. Medium term Support at 1.29-28. The Aussie has no near term Resistance till 0.81 at least and might be able to rise beyond that as well given the surge in Copper.

Dollar-Rupee quotes 64.31/36 on NDF.

INTEREST RATES

The US yields have dipped slightly from long term resistance levels and could remain stable in the coming sessions before moving down sharply later on. Overall long term trend is likely to remain down.

The UK-US 10YR (-1.05%) can rise towards resistance near-0.98% in the near term. the surge in Pound could continue for a few more sessions. Near term looks bullish.

The German-US 10Yr (-1.72%) and the German-Us 2Yr (-2.03%) both have bounced slightly from immediate supports and could move up in the near term again boosted by the strength in Euro. The rise in Euro and the yield spreads may continue for the next few sessions.

DATA TODAY

12:30 18:00 US Durable Goods Orders
...Expected 3.20 % ...Previous -1.08 %

23:30 5:00 JP Unemp
...Expected 3.0 % ...Previous 3.1 %

DATA YESTERDAY:-
--------------

AU CPI
...Expected 0.40 % ...Previous 0.45 % ...Actual 0.18 %

UK GDP
...Expected 0.30 % ...Previous 0.18 % ...Actual 0.30 %

US New Home Sales
...Expected 615 K ...Previous 605 K ...Actual 610 K

US FOMC Meeting
...Previous <1.25 % ...Actual <1.25 % ...Expected <1.25 %


DISCLAIMER
These views/ forecasts/ suggestions, though proferred with the best of intentions, are based on our reading of the market at the time of writing. They are subject to change without notice.Though the information sources are believed to be reliable, the information is not guaranteed for accuracy. Those acting in the market on the basis of these are themselves responsible for any profits or losses that might occur, without recourse to us. 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.

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