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USDINR opened at 82.65 on Tuesday and the pair traded in the 82.59-82.79 range. Spot USDINR closed at 82.73, gain of 6 ps for USD as against prior close of 82.67.

RBI reference rate was fixed at 82.76 on  25/10. Oct USD/INR closed at 82.86, gain of 5ps for USD as compared to prior day’s close of 82.81. Oct Euro/INR closed at 81.66, GBP/INR at 93.81 and Yen/INR at 55.65. USDINR fwd premia was trading at around 2.20% p.a.  FX reserves stands at USD 528.36 bn as on Oct 14 th.  FX reserves declined by USD 4.5 bn as compared to previous fortnight.

In Oct, FII’S have sold Rs 4470 Cr of Equities and have bought Rs 581 Cr of debt till date. In this Calendar Year, FII’S have sold close to Rs 1.50 lac Cr worth of Equities. In 2021-22, FII’S net sold Rs 128897 cr in Equity segment and have net bought Rs 4805 cr of debt. In 2020-21 financial Year, FII’S nett bought Rs 2,74,203 Cr of Equities and have sold Rs  42820 Cr in debt.

Benchmark Nifty declined 74 points (-0.42%) on Tuesday. DOW climbed 2 points (0.01%). Nikkei climbed 0.67% and Hang Seng climbed 1%.

Euro is now at 0.9769, Pound at 1.1205, Yen at 150.20.

Commodities: Gold is now at USD 1669 and WT1Crude at USD 88.08/Brent at USD 94.

Interest rates: USD 10 Yr yield is at 4.02% and 3 m libor closed at 4.24%. Indian 10 yr benchmark yield closed at 7.44%.

Economic news: USD declined against majors as US Yield retraced from its highs on hopes that Fed would shift to moderate rate hikes post Nov meeting. Euro and Asian currencies climbed on expectation that economic headwinds may force Fed to be less aggressive in rate hikes. Leading tech companies results in US are either below expectation or guidance is down. Microsoft and Google stocks were down over 7%.

Pound climbed as Rishi Sunak was appointed as new PM.

IMF Managing Director said that central banks should keep raising interest rates until they reach “neutral level”. “At this point we look for getting to a neutral mode, and in most places we are not quite yet there,” she added. She explained that rates has to go up since “when inflation runs high, that undermines growth, it hits the poorest parts of the population the hardest.”

Crude prices hit two weeks high as US Crude exports surged to 5.1 mn barrels per day, indicating robust demand. US Gasoline demand also remains strong. Markets overlooked increase in inventory. US has been releasing Oil from its strategic reserves.

Data highlights: – US Consumer confidence dipped to 102.5, House price index climbed 13.1% y/y. New home sales climbed to 603k.

-German Ifo survey improved to 84.3.

Thursday’s calendar : – US Weekly jobless claims, Durables order, GDP(advance)

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed above 200 day major moving averages.20 day moving average is at 82.17. 50 day moving average is at 80.73.200 day moving average is at 77.74. Daily MACD is in buy zone. Important support is at 82.03/81.95/81.70 and important resistance is at 82.67/83.30. Spot closed above its average level of the day.

Intraday supports and resistances for Oct contract are:

PP: 82.79, S1:82.65, S2:82.44, R1:83, R2:83.14.             

Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.

However on directional basis, suggest the following:

USDINR imports be hedged .

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is above 50 and 20 day major moving averages. Major resistance is at 1.01/1.02. Next major support is at 1.00 and later at 0.9845. Daily MACD is in buy zone, implying an important bottom at 0.9540. Weekly MACD is in sell zone, implying important top at 1.1498.

GBP/USD: The pair is below 50 and 20 day moving averages. Daily MACD is in buy zone, implying important bottom at 1.0380 and weekly MACD is in buy zone, implying important bottom at 1.0380. Important support is at 1.1440. Important resistance is at 1.1740.

USD/YEN: The pair is above 50 and 200 day moving averages. Daily MACD is in sell zone, implying important top at 152. Important support is at 144/140.40. Major resistance is at 152.

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