FX MORNING UPDATE

USDINR opened at 69.24 on Friday and the pair traded in the 69.20-69.53 range. Spot USDINR closed at 69.47 on Friday, gain of 20 ps for USD as against prior close of 69.27. RBI reference rate was fixed at 69.32 on Thursday. June USD/INR closed at 69.60, gain of 18ps for USD as compared to prior day’s close of 69.42. June Euro/INR closed at 78.54, GBP/INR at 88.56 and Yen/INR at 64.20.

FII’S have nett bought  Rs 725 Cr of Indian Equities in June . FII’S have nett bought Rs 77884 Cr of Indian Equities in this calendar Year till date. FII’S have nett sold Rs 1289 Cr of Indian debt securities in June. FII’S have nett bought Rs 1389 Cr of Indian debt in this calendar year till date.

Benchmark Nifty declined 0.23% on Friday. DOW climbed 263 points (1.08%) on Friday. Nikkei climbed 0.53% and Hang seng climbed 0.26 % on Friday.

Euro closed the week at 1.1333 ,Pound at 1.2740,Yen at 108.20.

Commodities: Gold is now at USD 1337 and WT1Crude at USD 54.05/Brent at USD 63.30.

Interest rates: USD 10 Yr yield is at 2.084% and 3 m libor closed at 2.61%. Indian 10 yr benchmark yield closed at 6.93%.        

Economic news: US non-farm payroll grew 75k in May, well below expectation of 180k. Monthly job gains have averaged 164k in 2019, notably lower than 223k monthly average in 2018. Unemployment rate was unchanged at 3.6% while participation rate was unchanged at 62.8%. Average hourly earnings rose 0.2% mom, below expectation of 0.3% mom.

Bundesbank sharply slashed German growth forecasts to just 0.6% in 2019 and said the economy is “currently experiencing a marked cool down”.                            

ECB Governing Council member said the biggest risks for Eurozone growth is that worsening global condition could slow trade. However, the current favorable financing conditions and robust domestic demand will support Eurozone economy.

Data highlights : -German industrial production declined -1.9% m/m.

Monday’s calendar: – UK industrial and manufacturing production.

USD/INR   69.53 69.20
EUR/USD 1.1267 1.1349 1.1251
GBP/USD 1.2696 1.2764 1.2688
USD/JPY 108.50 108.62 107.89

Daily Support/Resistance table

CurrencyPairs Pivot R1 R2 R3 S1 S2 S3
EURO/USD 1.1311 1.1371  1.1409    1.1273 1.1213  
GBP/USD 1.2716 1.2744  1.2792    1.2668 1.2640  
USD/JPY 108.33

 

108.78  109.07  

 

 108.04 107.59  

 

USD/INR 69.40 69.60 69.73   69.27 69.07  

 

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Curency Pair Supports Resistances Trend Remarks
EURO/USD 1.1110/1.0970/1.0840 1.1375 SIDE UP>1.1375
GBP/USD 1.2650 1.2865/1.3175 DN UP>1.30
USD/JPY 107.70 110.65 DN UP>110.85
USD/INR 69.05/68.90/68.30 69.60/69.75/70.06 DN UP>70.50
USD/CHF 0.9715 1.0050 DN  UP >1.0080

Technicals: Spot closed below major moving averages. 20 day moving average is at 69.79. 50 day moving average is at 69.53.200 day moving average is at 70.85. Daily MACD is in sell zone, implying top at 70.54. Next support is at 68.90. Important resistance is at 69.75 and later at 70.05 .Spot closed above its average level of the day.  

Intra day supports and resistances for June contract are:

PP: 69.53,S1:69.39, S2:69.18, R1:69.74, R2:69.88.                                                         

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 major moving average and hence bearish. Next Major resistance is at 1.1375. Major support is at 1.1110 and later at 1.0970. Daily MACD is in buy zone, implying an important bottom at 1.1106. Weekly MACD is in sell zone, implying important top at 1.1570.

GBP/USD: The pair is bearish and is trading below major moving averages.Daily MACD  is in buy zone, implying important bottom at 1.2558 and weekly MACD is  in sell zone, implying important top at 1.3385. Important resistance is at 1.2865. Important support is at 1.2560.

USD/YEN: The pair is below  major moving averages. Daily MACD is in sell zone, implying important top at 112.40. Next important resistance is at 110.70 and later at 112.40. Important support is at 107.75.

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