USDINR opened at 82.22 y’day and the pair traded in the 82.18-82.37 range. Spot USDINR closed at 82.30, gain of 14 ps for USD as against prior close of 82.16.

RBI reference rate was fixed at 82.28 on 15/05. May USD/INR closed at 82.30, gain of 7 ps for USD as compared to prior day’s close of 82.23. May Euro/INR closed at 89.59, GBP/INR at 102.91 and Yen/INR at 60.65. USDINR fwd premia was trading at around 2.10% p.a.  FX reserves climbed USD 8 bn as compared to prior week and stood at USD 596 bn as on May 5 th. This is the highest since June 2022.

In May till date, FII’S  have bought Rs 16682 Cr of Equities and have bought Rs 352 Cr of debt . In 2022-23 fiscal year, FII’S have net sold Rs 27593 Cr of Equities and have net bought Rs 838 Cr of debt.

Benchmark Nifty climbed 84 points (0.46%) y’day. DOW climbed 48 points (0.14%) y’day. Nikkei climbed 0.81% and Hang seng climbed 1.6% y’day..

Euro is now at 1.0879, Pound at 1.2527, Yen at 135.93.

Commodities: Gold is now at USD 2022 and WT1Crude at USD 71.50/Brent at USD 75.50.

Interest rates: USD 10 Yr yield is at 3.49% and 3 m libor closed at 5.33%. Indian 10 yr benchmark yield closed at 7%.

Economic news: Indian trade deficit shrunk to USD 15.24 bn in April and combined services and trade deficit declined to USD 1.38 bn. In March, trade deficit was at USD 19.73 bn. April exports stood at USD 34.66 bn, down from USD 38.88 bn in March. Imports also declined to USD 49.9 bn from USD 58.11 bn in March. Services exports was at USD 30.66 bn and Imports was USD 16.5 bn and surplus was USD 14.16 bn. In last fiscal, total exports was USD 775.87 bn, up 14% y/y. Merchandise exports was USD 450.43 bn and services exports was USD 325.44 bn.

New York Fed Empire State Business Conditions Index plummeted to -31.8 in May, a drastic drop of -42.6 points from its April reading of 10.8. Reading below zero signals deteriorating conditions.

Atlanta Fed President said that a proactive approach to combating inflation is the first priority, regardless of the cost.

Data highlights: – EU industrial production declined 4.1% m/m.

Tuesday’s calendar : – US retail sales and industrial production

-German and EU Zew surveys

-UK claimant count change and unemployment rate.

 Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed above all major major moving averages.20 day moving average is at 81.97. 50 day moving average is at 82.18.200 day moving average is at 81.49. Daily MACD is in buy zone. Important support is at 81.62/81.45 and important resistance is at 82.24/82.40. Spot closed above the average level of the day.

Intraday supports and resistances for May contract are:

PP: 82.31, S1:82.20, S2:82.12, R1:82.40, R2:82.50.             

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

However on directional basis, suggest the following:

USD Exports be hedged at 82.35+ levels.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below 20, 50 but above 100 and 200 day major moving averages. Major resistance is at 1.1075. Next major support is at 1.08/1.0750. Daily MACD is in sell zone, implying an important top at 1.1075. Weekly MACD is in buy zone, implying important bottom at 1.0515.

GBP/USD: The pair is above 50,100 and 200 day moving averages . Daily MACD is in buy zone, implying important bottom at 1.2345 and weekly MACD is in buy zone, implying important bottom at 1.1803. Important support is at 1.2350/1.2250. Important resistance is at 1.2675.

USD/YEN: The pair is below   200 day moving average. Daily MACD is in sell zone, implying important top at 137.75. Important resistance is at 137.75 and support is at 133.50/132/130.60.

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