FX MORNING UPDATE

                                                                          

USDINR opened  at 70.66 y’day and the pair traded in the 70.39-70.75 range. Spot USDINR closed at 70.47, loss of 4 ps for USD as against prior close of 70.51. RBI reference rate was fixed at 70.51. Nov USD/INR closed at 70.64, loss of 4 ps for USD as compared to prior day’s close of 70.68. Nov Euro/INR closed at 80.35, GBP/INR at 90.38 and Yen/INR at 62.67.

FII’S have invested Rs 10721 Cr in Indian Equities in Nov . FII’S have bought Rs 2115 Cr of Indian debt securities in Nov till date . On a cumulative basis, FII’S have sold Rupees 26536 Cr of Indian Equities till date for this calendar year and have sold  Rupees 57204 Cr of Indian debt in this calendar year till date.

Benchmark Nifty declined 0.80% y’day. DOW climbed 287 points (1.13%). Nikkei declined 0.53% and Hang seng declined 1.62% y’day.

Euro is now at 1.1342, Pound at 1.2721,Yen at 112.75.    

Commodities: Gold is now at USD 1244 and WT1Crude at USD 52.59/Brent at USD 61.27.

Interest rates: USD 10 Yr yield is at 2.92% and 3 m libor closed at 2.39%. Indian 10 yr benchmark yield closed at 7.44%.        

Economic news: RBI maintained status quo on repo rate, which has been left unchanged at 6.5%. SLR has been cut by 25 bps to 19.5% and SLR will be cut by 25 bps every quarter till it reaches 18%. GDP for this fiscal year is maintained at 7.4%. Inflation forecast has been revised lower to 2.7- 3.2% for Oct-March period of 2018-2019. Non food credit (up 15.2%) has grown beyond nominal GDP growth. RBI maintained calibrated tightening bias despite downward revision in inflation. RBI highlighted heightened financial markets volatility , global trade issues as major risk factors. RBI also maintained that durability of lower Oil prices have to be monitored as volatility is still high.

RBI Governor maintained that 1 lac Cr liquidity has been injected in the last 3 months.

 

Data highlights : -EU PMI(services) was finalized at 53.4. Retail sales climbed 0.3% m/m.

-UK PMI(services) declined to 50.4.

Thursday’s calendar:- US ISM (non mfrg), beige book and ADP employment report

-US Weekly jobless claims and factory orders                               

USD/INR   70.75 70.39
EUR/USD 1.1342 1.1361 1.1311
GBP/USD 1.2721 1.2798 1.2672
USD/JPY 112.75 113.24 112.69

Daily Support/Resistance table

CurrencyPairs Pivot R1 R2 R3 S1 S2 S3
EURO/USD 1.1340 1.1369 1.1390 1.1419 1.1319 1.1290 1.1269
GBP/USD 1.2732 1.2792 1.2858 1.2918 1.2666 1.2606 1.2540
USD/JPY 112.99

 

113.29 113.54 113.84

 

112.74 112.44 112.19

 

USD/INR 70.53 70.68 70.90   70.31 70.16

 

 

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Curency Pair Supports Resistances Trend Remarks
EURO/USD 1.1215 1.1500/1.1620 DOWN SIDE>1.15
GBP/USD 1.2660 1.3175/1.33 DOWN UP>1.3050
USD/JPY 112.30/111/35 114.20 UP DN<111.35
USD/INR 69.10 70.35/71 SIDE UP>71
USD/CHF 0.9845 1.0130 UP  DN <0.9845

Technicals: Spot closed below 20,50 and 100 day movong averages but still above 200 day major moving average. 20 day moving average is at 71.48. 50 day moving average is at 72.59. 200 day moving average is at 68.60. Daily MACD is in sell zone, implying top at 74.47 . Important support zone is at 69.50. Spot closed at its average level of the day.  

Intra day supports and resistances for DEC contract are:

PP: 70.70,S1:70.48, S2:70.32, R1:70.86, R2:71.08.                                                              

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 1.12. Daily MACD is in buy zone, implying an important bottom at 1.1215. 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 sell zone, implying important top at 1.3175 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 112.30. Next important support is at 112.30/111.35. Important resistance is at  114.20/114.40./

 

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