USDINR opened at 82.26 y’day and the pair traded in the 81.72-82.31 range. Spot USDINR closed at 81.79, loss of 57 ps for USD as against prior close of 82.36.
RBI reference rate was fixed at 81.82 on 10/01. Jan USD/INR closed at 81.82, loss of 62 ps for USD as compared to prior day’s close of 82.44. Jan Euro/INR closed at 87.97, GBP/INR at 99.65 and Yen/INR at 62.19. USDINR fwd premia was trading at around 2.14% p.a. FX reserves stands at USD 562 bn as on Jan 6 th.
| PAIRS | RBI REF RATE (10/01) |
| USDINR | 81.82 |
| EURINR | 88.28 |
| GBPINR | 100.05 |
| JPYINR | 62.35 |
In Jan, FII’S have sold Rs 2312 Cr of Equities till date and have sold Rs 1348 Cr of debt till date. In last Calendar Year, FII’S sold close to Rs 1.06 lac Cr worth of Equities.
Benchmark Nifty declined 176 points (0.97%) y’day. DOW climbed 186 points (0.56%) y’day. Nikkei climbed 0.78% and Hang Seng declined 0.27% y’day.
Euro is now at 1.0738, Pound at 1.2152, Yen at 132.30.
Commodities: Gold is now at USD 1881 and WT1Crude at USD 74.60/Brent at USD 79.50.
Interest rates: USD 10 Yr yield is at 3.60% and 3 m libor closed at 4.81%. Indian 10 yr benchmark yield closed at 7.32%.
Economic news: Rupee gained due to stop loss selling below 82.20. This is a 50 day average rate. Normally, traders watch for fall below 50 day average for short term reversal. Next important support is expected near 81.55.
US CPI, Indian CPI and IIP are important data releases for the week.
World Bank lowered global growth forecast to 1.7% in the latest Global economics report , down sharply from 3.0% expected six months ago. It said, “Global growth is slowing sharply in the face of elevated inflation, higher interest rates, reduced investment, and disruptions caused by Russia’s invasion of Ukraine.” US is expected to grow by 0.5%, EU by 0%, China by 4.3%. India is expected to grow by 6.6% in 2023.
Fed Chairman said in a speech y’day that “Price stability is the bedrock of a healthy economy and provides the public with immeasurable benefits over time. But restoring price stability when inflation is high can require measures that are not popular in the short term as we raise interest rates to slow the economy,”.
San Francisco Fed President Mary Daly said in a WSJ interview that she expects interest rate to rise from the current 4.25-4.50% to 5.00-5.25%. But she added that “doing it in more gradual steps does give you the ability to respond to incoming information.”
Data highlights: – No major data release
Wednesday’s calendar : No major data release
| USD/INR | 82.31 | 81.72 | ||
| EUR/USD | 1.0738 | 1.0759 | 1.0712 | |
| GBP/USD | 1.2152 | 1.2198 | 1.2110 | |
| USD/JPY | 132.30 | 132.48 | 131.40 |
Daily Support/Resistance table
| Currency Pairs | Pivot | R1 | R2 | R3 | S1 | S2 | S3 |
| EURO/USD | 1.0737 | 1.0762 | 1.0784 | 1.0809 | 1.0715 | 1.0690 | 1.0668 |
| GBP/USD | 1.2154 | 1.2198 | 1.2242 | 1.2286 | 1.2110 | 1.2066 | 1.2022 |
| USD/JPY | 131.99 | 132.58 | 133.07 | 133.66 | 131.50 | 130.91 | 130.43 |
| USD/INR | 81.94 | 82.16 | 82.53 | 81.57 | 81.35 |
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
| Currency Pair | Supports | Resistances | Trend | Remarks |
| EURO/USD | 1.0480 | 1.0740/1.0945 | UP | SIDE<1.0420 |
| GBP/USD | 1.1840/1.1650 | 1.2445 | UP | DN<1.1840 |
| USD/JPY | 129.50/126.50 | 134.50 | DN | SIDE>134.50 |
| USD/INR | 81.95/82.10/82.25 | 81.55 | DN | SIDE>82.50 |
| USD/CHF | 0.92/0.91 | 0.94 | DN | SIDE>0.94 |
Technicals: Spot closed below 20 and 50 day averages, but still above 100, 200 day major moving averages.20 day moving average is at 82.73. 50 day moving average is at 82.25.200 day moving average is at 79.63. Daily MACD is in sell zone. Important support is at 81.55 and important resistance is at 81.95/82.10/82.40. Spot closed below its average level of the day.
Intraday supports and resistances for Jan contract are:
PP: 82.01, S1:81.61, S2:81.40, R1:82.22, R2:82.62.
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 82.60/82.75+.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is above 50 and 200 day major moving averages. Major resistance is at 1.0735/1.08/1.0945. Next major support is at 1.0480/1.0420. Daily MACD is in sell zone, implying an important top at 1.0740. 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 sell zone, implying important top at 1.2445 and weekly MACD is in buy zone, implying important bottom at 1.0380. Important support is at 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 129.50/126.50. Major resistance is at 134.50/138.50.
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