USDINR opened at 82.77 y’day and the pair traded in the 82.71-82.79 range. Spot USDINR closed at 82.74, loss of 11 ps for USD as against prior close of 82.85. Rupee gained, despite broad USD’S strength against majors.

RBI reference rate was fixed at 82.76 on 23/02. Feb USD/INR closed at 82.74, loss of 16 ps for USD as compared to prior day’s close of 82.90. Feb Euro/INR closed at 87.72, GBP/INR at 99.47 and Yen/INR at 61.32. USDINR fwd premia was trading at around 2.11% p.a.  FX reserves stands at USD 567 bn as on Feb 17 th. Reserves declined 8 bn USD as compared to prior week due to Valuation dip in FCY assets.  

In Feb, FII’S  sold Rs 1408 Cr of Equities and have bought Rs 9188 Cr of debt . In last Calendar Year, FII’S sold close to Rs 1.06 lac Cr worth of Equities.

Benchmark Nifty declined 43 points (0.25%) y’day. DOW climbed 108 points (0.33%) . Nikkei is up 1.08% and Hang Seng is down 1.6% in early trading session today.

Euro is now at 1.0597, Pound at 1.2016, Yen at 134.73.

Commodities: Gold is now at USD 1835 and WT1Crude at USD 74/Brent at USD 81.

Interest rates: USD 10 Yr yield is at 3.88% and 3 m libor closed at 4.87%. Indian 10 yr benchmark yield closed at 7.42%.

Economic news: Better than expected US weekly jobless claims confirms inflationary pressure in US economy, due to strong income potential. This raises Fed’s terminal rate hike to 5.5% from earlier estimate of 5.25%. This bodes well for USD and negative for Equities.

US Core PCE data and personal spending data are key data events for the day.

Data highlights: – US Weekly jobless claims dipped to 192k.

-EU CPI climbed to 5.3% y/y.

Friday’s calendar : –  US Personal income, spending and Core PCE data

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed below 50 day average, but still above 20, 100 and 200 day major moving averages.20 day moving average is at 82.44. 50 day moving average is at 82.31.200 day moving average is at 80.48. Daily MACD is in buy zone. Important supports are at 82.58/82.34  and important resistance is at 82.95. Spot above below the average level of the day.

Intraday supports and resistances for Feb contract are:

PP: 82.77, S1:82.69, S2:82.64, R1:82.82, R2:82.90.             

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

However on directional basis, suggest the following:

Exports be hedged.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is above 100 and 200 day major moving averages. Major resistance is at 1.08. Next major support is at 1.0480. Daily MACD is in sell zone, implying an important top at 1.1035. Weekly MACD is in buy zone, implying important bottom at 0.9535.

GBP/USD: The pair is above 100 and 200 day moving averages , but below 20 and 50 day averages. Daily MACD is in sell zone, implying important top at 1.2450 and weekly MACD is in buy zone, implying important bottom at 1.0380. Important support is at 1.1920. Important resistance is at 1.2270.

USD/YEN: The pair is below 100 and 200 day moving averages. Daily MACD is in buy zone, implying important bottom at 127.25. Important resistance is at 132.90. Major support is at 127.25.

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