15/10/2018                                                                                  

USDINR opened lower at 73.83 on Friday and the pair traded in the 73.52-73.85 range. Spot USDINR closed at 73.56, loss of 56 ps ps for USD as against prior close of 74.12.RBI reference rate was fixed at 73.79. Rupee gained as Crude declined further. Oct USD/INR closed at 73.70, loss of 51 ps for USD as compared to prior day’s close of 74.21. Oct Euro/INR closed at 85.43, GBP/INR at 97.40 and Yen/INR at 65.70.

FII’S have sold Rs 11236 Cr of Indian Equities in Oct till date . FII’S have sold Rs 7976 Cr of Indian debt securities in Oct till date . On a cumulative basis, FII’S have sold Rupees 25858 Cr of Indian Equities till date for this calendar year and have sold  Rupees 57277 Cr of Indian debt in this calendar year till date.

Benchmark Nifty climbed 2.32% on Friday. DOW climbed 287 points (1.15%) on Friday. Nikkei climbed 0.46% and Hang seng climbed 0.06% y’day.

Euro closed the week at 1.1558, Pound at 1.3155,Yen at 112.19.

Commodities: Gold is now at USD 1221 and WT1Crude at USD 71.50.

Interest rates: USD 10 Yr yield is at 3.14% and 3 m libor closed at 2.39%. Indian 10 yr benchmark yield closed at 7.98%.        

Economic news: Indian IIP climbed 4.3% in Aug due to contraction in mining output. Mfrg sector grew 4.6% in Aug. Consumer durables grew by 5.2% and nondurables sector grew by 6.3%. IIP has climbed 5.2% in Apr-Aug period. CPI inflation was subdued as it climbed only 3.77% in Sept as food inflation remained subdued.

China’s trade surplus surprisingly widened in September, as trade surplus with US jumped to record high at USD 34.1B. In USD terms, China’s trade surplus widened to USD 31.7B in September, well above expectation of USD 19.4B. Exports rose 14.5% yoy to USD 226.7B. Import rose 14.3% yoy to 195.0B.                                                                     

ECB Chief maintained that monetary stimulus is stll needed in EU, despite positive outlook to growth.

US Treasury secy said that decline in US markets is not linked to Fed’s rate hike and added that correction from high levels is inevitable. He said that there is no new information on rate or trade matters to warrant the steep fall witnessed last week.

Data Highlights: – US Weekly jobless claims rose 7k to 214k and CPI climbed 0.1% m/m, below consensus.

-EU industrial production climbed 1% m/m.

Monday’s calendar:- US retail sales and NY mfrg index.

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 73.05. 50 day moving average is at 71.23. 200 day moving average is at 67.30. Daily MACD is in buy zone, implying bottom at 68.30 . Important support zone is at 73.40/72.90. Spot closed below its average level of the day.  

Intra day supports and resistances for Oct contract are:

PP: 73.82,S1:73.53, S2:73.36, R1:73.99, R2:74.28.                                                               

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

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below major moving averages. Next Major resistance is at 1.1820 and later at 1.1960. Major support is at 1.13. Daily MACD is in sell zone, implying an important top at 1.1820. 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 1.2925 and weekly MACD is  in buy zone, implying important bottom at 1.2665. The pair is trading below 200 day moving average. Important resistance is at 1.33 and later at 1.35. Important support is at 1.2925 and later at 1.2785.

USD/YEN: The pair is above major moving averages. Daily MACD is in sell zone, implying important top at 114.56. Next important support is at 111.85/110.55. Important resistance is at  114.60.