Morning Market Update: Yen Drives Forex Fluctuations

Recent movements in the forex market have been significantly influenced by the yen. After a statement from Bank of Japan Deputy Governor Shinichi Uchida regarding stable interest rates, the yen weakened, boosting the dollar index from 102.15. However, the index may face resistance between 103.80 and 104.00, potentially limiting the euro’s decline to 1.0850. USD/JPY and EUR/JPY are expected to rise to 148-150 and 161-163, respectively.

The British pound may test support at 1.26, while the Australian dollar could target 0.6580-0.66. USD/CNY is approaching 7.20, and EUR/INR may find support near 91.50 and 91. USD/INR bulls aim to push the pair above 84 unless it retreats to 83.80. Attention is on today’s Reserve Bank of India meeting, which could increase currency volatility.

U.S. Treasury yields are rising, with resistance levels ahead, and may decline after testing these points. German yields have rebounded but are expected to trend downward again. Indian 10-year and 5-year yields have fallen, suggesting potential further declines.

In equities, the Dow Jones and Nifty indices show weak momentum and could fall to 38,200 and 23,500-23,300. The DAX has experienced a corrective rise, while the Nikkei remains bullish above 31,000. The Shanghai Composite might see a brief rise before continuing its downtrend.

Oil prices have rebounded, potentially reaching $78-80 (WTI) and $80-82 (Brent). Gold, silver, and copper might decline further to 2400-2350, 26, and 3.85-3.80 before possibly rebounding. Natural gas continues its upward trend, with potential to reach 2.2-2.5 in the short term.

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