FX MORNING UPDATE 

                                                                   

USDINR opened at 71.34 y’day and the pair traded in the 71.13-71.53 range. Spot USDINR closed at 71.27, gain of 8 ps for USD as against prior close of 71.19. RBI reference rate was fixed at 71.38. Jan USD/INR closed at 71.34, gain of 9 ps for USD as compared to prior day’s close of 71.25. Jan Euro/INR closed at 81.17, GBP/INR at 91.81 and Yen/INR at 65.14. Rupee has declined 2 Rupees since its recent level of 69.20 traded on 7 th Jan.

FII’S have sold Rs 1983 Cr of Indian Equities in Jan till date . FII’S have sold Rs 2460 Cr of Indian debt securities in Jan till date .

Benchmark Nifty climbed 0.5% y’day. DOW climbed 336 points (1.38%) on Friday. US market was closed y’day. Asian markets are trading marginally lower today.

Euro is now at 1.1370, Pound at 1.2893,Yen at 109.53.    

Commodities: Gold is now at USD 1277 and WT1Crude at USD 53.76 /Brent at USD 62.30.

Interest rates: USD 10 Yr yield is at 2.78% and 3 m libor closed at 2.90%. Indian 10 yr benchmark yield closed at 7.31%.        

Economic news: Chinese GDP growth slowed to 6.4% yoy in Q4, down from 6.5% yoy and matched expectation. For the whole year of 2018, growth slowed to 6.6%, lowest in 28 years since 1990. Retail sales grew 8.2% yoy, up from 8.1% yoy and beat expectation of 8.1% yoy. Industrial production rose 5.7% yoy, up fro 5.4% and beat expectation of 5.3% yoy. Fixed assets investment grew 5.9% yoy, unchanged from November, but missed expectation of 6.0%.

IMF lowered Global economic growth to 3.5% for 2019, citing Chinese slow down, Brexit uncertainity, trade tensions and possible tightening of financial conditions. Indian GDP is likely to grow by 7.5%, US by 2.5%, EU by 1.6%, Japan by 1.1% and China by 6.2%.

 

Data highlights : – No major data. US bank holiday.         

Tuesday’s calendar: – US existing home sales

-EU and German Zew surveys

-UK unemployment rate and claimant count change                  

USD/INR   71.53 71.13
EUR/USD 1.1370 1.1391 1.1357
GBP/USD 1.2893 1.2911 1.2831
USD/JPY 109.53 109.72 109.47

Daily Support/Resistance table

CurrencyPairs Pivot R1 R2 R3 S1 S2 S3
EURO/USD 1.1372 1.1387 1.1406 1.1421 1.1353 1.1338 1.1320
GBP/USD 1.2878 1.2925 1.2958 1.3005 1.2845 1.2798 1.2764
USD/JPY 109.62

 

109.77 109.87 111.02

 

109.52 109.37 109.27

 

USD/INR 71.31 71.49 71.71   71.09 70.91

 

 

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Curency Pair Supports Resistances Trend Remarks
EURO/USD 1.1270/1.1215 1.1575 SIDE UP>1.1575
GBP/USD 1.2745/1.2440 1.31 SIDE UP>1.31
USD/JPY 105 111/112 SIDE UP>112
USD/INR 70.50/70.10 71.70/71.90/72.50 SIDE DN<70.10
USD/CHF 0.9715 1.0130 UP  SIDE >0.9850

Technicals: Spot closed above 20,50 and 200 day moving averages but still below 100 day major moving average. 20 day moving average is at 70.38. 50 day moving average is at 70.90. 200 day moving average is at 69.60. Daily MACD is in buy zone, implying bottom at 69.20. Important support zone is at 70.50 and later at 70.10. Spot closed below its average level of the day.  

Intra day supports and resistances for Jan contract are:

PP: 71.37,S1:71.14, S2:70.95, R1:71.56, R2:71.79                                                           

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

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below 200 day moving average. Next Major resistance is at 1.1620 and later at 1.17. Major support is at 1.1265/1.12. Daily MACD is in sell zone, implying an important top at 1.1572. Weekly MACD is in buy zone, implying important bottom at 1.1215.

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 1.2440 and weekly MACD is  in buy zone, implying important bottom at 1.2440. Important resistance is at 1.31. Important support is at 1.2765 and later at 1.2440.

USD/YEN: The pair is below major moving averages. Daily MACD is in buy zone, implying important bottom at 105. Next important resistance is at 111/112.

 

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