17/09/2018

USDINR opened gap down at 71.69 on Friday and the pair traded in the 71.52-71.98 range. Spot USDINR closed at 71.84, loss of 34 ps ps for USD as against prior close of 72.18.RBI reference rate was fixed at 71.81. Rupee has gained One Rupee from its lows of 72.92 on expectation of Govt measures. Despite last two days of gains, Rupee has still declined 13.5% from its high levels of 63.25 in this calendar year. Sep USD/INR closed at 71.94, loss of 32 ps for USD as compared to prior day’s close of 72.26. Sep Euro/INR closed at 84.22, GBP/INR at 94.40 and Yen/INR at 64.33.

FII’S have sold Rs 1417 Cr of Indian Equities in Sept till 12/9 . FII’S have sold Rs 4748 Cr of Indian debt securities in Sept till 12/9 . On a cumulative basis, FII’S have sold Rupees 1416 Cr of Indian Equities till date for this calendar year and have sold  Rupees 43521 Cr of Indian debt in this calendar year till date.

Benchmark Nifty climbed 1.28% on Friday. DOW climbed 8 points (0.03%) on Friday. Nikkei climbed 1.20% and Hang seng climbed 1.01% on Friday.

Euro closed the week at 1.1623, Pound at 1.3070,Yen at 112.07.

Commodities: Gold is now at USD 1198 and WT1Crude at USD 69.

Interest rates: USD 10 Yr yield is at 2.99% and 3 m libor closed at 2.36%. Indian 10 yr benchmark yield closed at 8.13%.        

Economic news: Govt announced 5 major measures to check Rupee decline. Curb on non essential imports, abolition of withholding tax on Rupee denominated (Masala) bonds, increase in FPI exposure to corporate debt and allowing 1 year average maturity for ECB loans for manufacturing companies (upto USD 50 mn) were part of first stage measures. FM said that discussion with PM will continue and more steps are expected to be announced. Economic affairs Secy said that import curbs on items are to be identified and above steps would increase inflows. WPI inflation eased to 4 month low of 4.5%.    

Data Highlights: – US Core retail sales climbed less than expected by 0.3% m/m and industrial production climbed 0.4% m/m.

Monday’s calendar: – Ny mfrg index and EU CPI

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed above 100 and 200 day major moving averages. 20 day moving         is at 70.98. 50 day moving average is at 69.64. 200 day moving average is at 66.53. Daily MACD is in buy zone, implying bottom at 68.30 . Important support zone is at 71.20/70.70 and later at 70.30. Important resistance is at 72.90. Spot closed above its average level of the day.  

Intra day supports and resistances for Sep contract are:

PP: 71.87,S1:71.66, S2:71.39, R1:72.14, R2:72.35.                                                              

Hedging strategy for USD/INR: Hedging decisions be taken according to comfort and accounting rates.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below 100 and 200 day major moving averages. Next Major resistance is at 1.1735 and later at 1.1960. Major support is at 1.13. Daily MACD is in sell zone, implying an important top at 1.1735. Weekly MACD is in sell zone, implying important top at 1.2560.

GBP/USD: Trend is sideways in daily chart. Daily MACD  is in buy zone, implying important bottom at 1.2662 and weekly MACD is  in sell zone, implying important top at 1.4375. The pair is trading below all major moving averages. Important resistance is at 1.32. Important support is at 1.2940 and later at 1.2660.

USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 109.70. Next important support is at 109.70. Important resistance is at  113.10.