USDINR opened at 72.70 on Friday and the pair traded in the 72.45-72.82 range. Spot USDINR closed at 72.49, loss of 51 ps for USD as against prior close of 73. RBI reference rate was fixed at 72.73. Rupee has gained close to 2 Rs since hitting a low of 74.45 in Oct. Decline in crude price is a sole factor driving Rupee’s upward correction. Nov USD/INR closed at 72.63, loss of 4 ps for USD as compared to prior day’s close of 72.67. Nov Euro/INR closed at 82.56, GBP/INR at 94.63 and Yen/INR at 63.90.
FII’S invested Rs 940 Cr in Indian Equities on Nov 1 st . FII’S have bought Rs 570 Cr of Indian debt securities in Nov till date . On a cumulative basis, FII’S have sold Rupees 36304 Cr of Indian Equities till date for this calendar year and have sold Rupees 58750 Cr of Indian debt in this calendar year till date.
Benchmark Nifty declined 0.12% on Friday. DOW declined 201 points (0.77%) Y’day. Nikkei declined 1.05% and Hang seng declined 2.39% y’day.
Euro closed the week at 1.1336, Pound at 1.2971,Yen at 113.82.
Commodities: Gold is now at USD 1210 and WT1Crude at USD 59.84/Brent at USD 69.65.
Interest rates: USD 10 Yr yield is at 3.186% and 3 m libor closed at 2.39%. Indian 10 yr benchmark yield closed at 7.76%.
Economic news: USD gained as US election uncertainty faded and on expectation that Fed will maintain course on rate hike. Euro is close to breaking 1.13 and its movement will be decided by EU data and economic forecasts. While US Fed will tighten rates in 2019, ECB is unlikely to even make a beginning of rate hike in 2019 and that is also conditional on economic performance.
US inflation and retail sales data are other major economic data releases scheduled in coming week.
Oil slumped further as US granted waiver from Iran sanctions to 8 major customers of Iran Oil, including India. Russia and Saudi Arabia had not anticipated this and had started to increase Oil production much ahead of the announcement. Brent Crude is now closer to USD 70.
Indian IIP and CPI are key domestic releases for this week.
UK Q3 GDP growth accelerated to 0.6% qoq, matched market expectations. That’s also the fastest rate since Q4 2016.
Data highlights:- US PPI climbed 0.6% m/m.
-UK Industrial production was flat m/m and manufacturing production climbed 0.2% m/m. UK GDP climbed 0.6% q/q in Q3.
Monday’s calendar:- No major Global data releases.
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 73.43. 50 day moving average is at 72.70. 200 day moving average is at 68.11. Daily MACD is in sell zone, implying top at 74.47 . Important support zone is at 72.10. Spot closed below its average level of the day.
Intra day supports and resistances for Nov contract are:
PP: 72.72,S1:72.49, S2:72.36, R1:72.85, R2:73.08.
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 1.1500 and later at 1.1620. Major support is at 1.13. Daily MACD is in sell zone, implying an important top at 1.1505. Weekly MACD is in sell zone, implying important top at 1.1805.
GBP/USD: The pair is below 200 day moving average.Trend is sideways in daily chart. Daily MACD is in buy zone, implying important bottom at 1.2790 and weekly MACD is in buy zone, implying important bottom at 1.2665. Important resistance is at 1.3175 and later at 1.33. Important support is at 1.2660.
USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 111.35. Next important support is at 112.90/111.35. Important resistance is at 114.60.