FX MORNING UPDATE
USDINR opened at 80.94 y’day and the pair traded in the 80.89-81.49 range. Spot USDINR closed at 81.39, gain of 27 ps for USD as against prior close of 81.12.
RBI reference rate was fixed at 81.27 on 23/01. Jan USD/INR closed at 81.46, gain of 26 ps for USD as compared to prior day’s close of 81.20. Jan Euro/INR closed at 88.69, GBP/INR at 100.67 and Yen/INR at 62.65. USDINR fwd premia was trading at around 2.30% p.a. FX reserves stands at USD 572 bn as on Jan 13 th. Reserves rose by USD 10 bn in one week.
| PAIRS | RBI REF RATE (23/01) |
| USDINR | 81.27 |
| EURINR | 88.54 |
| GBPINR | 100.90 |
| JPYINR | 62.49 |
In Jan, FII’S have sold Rs 11892 Cr of Equities till date and have bought Rs 1085 Cr of debt till date. In last Calendar Year, FII’S sold close to Rs 1.06 lac Cr worth of Equities.
Benchmark Nifty climbed 91 points (0.50%) oy’day. DOW climbed 254 points (0.76%) y’day. Nikkei climbed 1.33% y’day and Hang Seng climbed 1.82% on Friday.
Euro is now at 1.0877, Pound at 1.2384, Yen at 130.33.
Commodities: Gold is now at USD 1933 and WT1Crude at USD 82/Brent at USD 88.
Interest rates: USD 10 Yr yield is at 3.51% and 3 m libor closed at 4.81%. Indian 10 yr benchmark yield closed at 7.37%.
Economic news: RBI intervened to stem Rupee gains above 80.90. RBI’S intervention pushed Rupee to 81.48.
Euro climbed past 1.09 on hawkish messages from ECB officials. ECB Governing Council member said “there are grounds for significant increases” in the key interest rate in the winter and early spring. Euro could climb to 1.1050/1.11 soon.
Data highlights: – No major data release.
Tuesday’s calendar : – EU PMI(flash-mfg) and PMI(flash-services)
-UK PMI(mfrg) and PMI(services)
| USD/INR | 81.49 | 80.89 | ||
| EUR/USD | 1.0877 | 1.0927 | 1.0846 | |
| GBP/USD | 1.2384 | 1.2447 | 1.2323 | |
| USD/JPY | 130.33 | 130.30 | 129.05 |
Daily Support/Resistance table
| Currency Pairs | Pivot | R1 | R2 | R3 | S1 | S2 | S3 |
| EURO/USD | 1.0882 | 1.0918 | 1.0963 | 1.0999 | 1.0837 | 1.0801 | 1.0756 |
| GBP/USD | 1.2383 | 1.2443 | 1.2506 | 1.2566 | 1.2319 | 1.2260 | 1.2196 |
| USD/JPY | 130.18 | 131.31 | 132.02 | 133.15 | 129.46 | 128.34 | 127.62 |
| USD/INR | 81.25 | 81.62 | 81.85 | 81.01 | 80.65 |
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
| Currency Pair | Supports | Resistances | Trend | Remarks |
| EURO/USD | 1.0740/1.0575 | 1.1045 | UP | SIDE<1.0575 |
| GBP/USD | 1.2110/1.1840 | 1.2445 | UP | SIDE<1.2110 |
| USD/JPY | 126.50 | 134.50 | DN | SIDE>134.50 |
| USD/INR | 81.24/81.10/80.90 | 81.48/81.65 | DN | SIDE>81.65 |
| USD/CHF | 0.9090 | 0.94 | DN | SIDE>0.94 |
Technicals: Spot closed below 20 ,50,100 day averages, but still above 200 day major moving averages.20 day moving average is at 82.10. 50 day moving average is at 82.10.200 day moving average is at 79.98. Daily MACD is in sell zone. Important support is at 81.24/81.10/80.90/80.50 and important resistance is at 81.93. Spot closed below its average level of the day.
Intraday supports and resistances for Jan contract are:
PP: 81.29, S1:81.07, S2:80.69, R1:81.67, R2:81.89.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
Exports be hedged on rally to 81.90+.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is above 50 and 200 day major moving averages. Major resistance is at 1.0945/1.1045. Next major support is at 1.0740/1.0475. Daily MACD is in buy zone, implying an important bottom at 1.0480. Weekly MACD is in buy zone, implying important bottom at 0.9535.
GBP/USD: The pair is above 50 and 200 day moving averages. Daily MACD is in buy zone, implying important bottom at 1.1840 and weekly MACD is in buy zone, implying important bottom at 1.0380. Important support is at 1.2110/1.1840. Important resistance is at 1.2450/1.2750.
USD/YEN: The pair is below 20, 50 and 100 day moving averages. Daily MACD is in sell zone, implying important top at 134.50. Important support is at 126.50. Major resistance is at 134.50/138.50.
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