FX – MORNING UPDATE :
USDINR opened at 83.27 on Friday and the pair traded in the 83.27-83.70 range. Spot USDINR closed at 83.67, gain of 55 ps for USD as against prior close of 83.12.
RBI reference rate was fixed at 83.35 on 22/03. Mar USD/INR closed at 83.67, gain of 54 ps for USD as compared to prior day’s close of 83.13. Mar Euro/INR closed at 90.49, GBP/INR at 105.27 and Yen/INR at 55.25. 1 year USDINR fwd premia was trading at around 1.61% p.a. FX reserves stood at USD 642 bn, as on March 15 th. Reserves climbed USD 6 bn w/w.
|
PAIRS |
RBI REF RATE (22/03) |
|
USDINR |
83.35 |
|
EURINR |
90.26 |
|
GBPINR |
105.25 |
|
JPYINR |
55.05 |
In March, FPI’S bought Rs 35926 Cr of Equities and bought Rs 13439 Cr of debt . In last calendar year, FII’S have net bought Rs 172853 Cr of Equities and have net bought Rs 70489 Cr of debt.
Benchmark Nifty climbed 85 points (0.39%) on Friday. US S&P declined 7 points (0.14%) on Friday. Nikkei climbed 2.08% and Hang Seng climbed 1.93% on Friday.
Euro is now at 1.0807, Pound at 1.2601, Yen at 151.45.
Commodities: Gold is now at USD 2165 and WT1Crude at USD 81/Brent at USD 85.50.
Interest rates: USD 10 Yr yield is at 4.20% and 3 m libor closed at 5.59%. Indian 10 yr benchmark yield closed at 7.05%.
Economic news: Rupee declined 55 ps, and largest single day decline in recent months. RBI has been absorbing USD inflows and this contributed to cash Dollar shortage, In last two weeks, RBI ‘S FX reserves has swelled by USD 17 bn. Besides, USD’S strength against majors and Asian peers also weighed down on Rupee. Fiscal year end payments by importers and debt repayment flows also contributed to Rupee fall. RBI did not intervene effectively and for the first time in 18 months, they have allowed higher than normal volatility.
Swiss bank cut rates and overshadowed Fed’s hint of three rate cuts in this year. Euro declined along with CHF. Yuan also was also weaker as US mulls investment restrictions by US funds in Chinese stocks.
While BOE statement was considered dovish, careful reading of Fed’s statement hints at more gradual easing.
Data highlights: – German Ifo business climate improved to 87.8.
-UK retail sales was flat m/m.
Monday’s calendar : – US New home sales
|
USD/INR |
|
83.70 |
83.27 |
|
|
EUR/USD |
1.0807 |
1.0869 |
1.0802 |
|
|
GBP/USD |
1.2601 |
1.2803 |
1.2651 |
|
|
USD/JPY |
151.45 |
151.77 |
150.27 |
Daily Support/Resistance table
|
Currency Pairs |
Pivot |
R1 |
R2 |
R3 |
S1 |
S2 |
S3 |
|
EURO/USD |
1.0826 |
1.0850 |
1.0740 |
|
1.0783 |
1.0759 |
|
|
GBP/USD |
1.2685 |
1.2719 |
1.2837 |
|
1.2567 |
1.2533 |
|
|
USD/JPY |
151.16 |
152.05 |
152.66 |
|
150.55 |
149.66 |
|
|
USD/INR |
83.54 |
83.82 |
83.97 |
|
83.38 |
83.11 |
|
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
|
Currency Pair |
Supports |
Resistances |
Trend |
Remarks |
|
EURO/USD |
1.09 |
1.07 |
DN |
UP>1.10 |
|
GBP/USD |
1.2515 |
1.28/1.29 |
DN |
UP>1.2805 |
|
USD/JPY |
149/146.50/144.35 |
152.50 |
UP |
SIDE<149 |
|
USD/INR |
84.10 |
83.55/83.47/83.33 |
UP |
SIDE<83.44 |
|
USD/CHF |
0.8890/0.8725 |
0.91 |
UP |
DN<0.8725 |
Technicals: Spot closed above major moving averages.20 day moving average is at 82.94. 50 day moving average is at 83. 200 day moving average is at 82.89. Daily MACD is in buy zone. Important support is at 83.47/83.35 and important resistance is at 84.10. Spot closed above the average level of the day.
Intraday supports and resistances for March contract are:
PP: 83.52, S1:83.31, S2:82.96, R1:83.87, R2:84.08.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USD imports be hedged on decline to 83.35.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below major moving averages. Major resistance is at 1.09/1.10. Next major support is at 1.07. Daily MACD is in sell zone, implying an important support at 1.07. Weekly MACD is in sell zone, implying important top at 1.1140.
GBP/USD: The pair is between major moving averages. Daily MACD is in sell zone, implying important top at 1.29 and weekly MACD is in buy zone, implying important bottom at 1.2517. Important support is at 1.2515. Important resistance is at 1.28/1.29.
USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 146.50. Important resistance is at 152.50 and support is at 149/146.50.
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