USDINR opened at 68.65 Y’day and the pair traded in the 68.48-68.67 range. Spot USDINR closed at 68.57 Y’day, gain of 2 ps for USD as against prior close of 68.55. RBI reference rate was fixed at 68.69 on Monday. July USD/INR closed at 68.71, gain of 3ps for USD as compared to prior day’s close of 68.68. July Euro/INR closed at 77.23, GBP/INR at 85.82 and Yen/INR at 63.22.

FII’S have nett sold  Rs 3141 Cr of Indian Equities in July . FII’S have nett bought Rs 75775 Cr of Indian Equities in this calendar Year till date. FII’S have nett bought Rs 1369 Cr of Indian debt securities in July. FII’S have nett bought Rs 11734 Cr of Indian debt in this calendar year till date.

Benchmark Nifty declined -0.49% Y’day. DOW climbed 77 points(0.29%) y’day. Nikkei climbed 0.13% and Hang seng was up 0.31%.

Euro is now at 1.1258 ,Pound at 1.2507,Yen at 108.14.    

Commodities: Gold is now at USD 1425 and WT1Crude at USD 60.50/Brent at USD 66.90.

Interest rates: USD 10 Yr yield is at 2.06% and 3 m libor closed at 2.30%. Indian 10 yr benchmark yield closed at 6.54%.        

Economic news: USD weakened after Fed Chairman’s testimony.US Fed Chairman in his testimony said since June meeting, “based on incoming data and other developments, it appears that uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook. Inflation pressures remain muted.”

Fed Chairman, also reiterated Fed’s stance that “in light of increased uncertainties about the economic outlook and muted inflation pressures, we would closely monitor the implications of incoming information for the economic outlook and would act as appropriate to sustain the expansion.”

European Commission kept 2019 Eurozone growth forecast unchanged at 1.2%. But for 2020, growth projection was lowered slightly from 1.5% to 1.4%. For EU28, 2019 and 2020 growth forecasts were kept unchanged at 1.4% and 1.6% respectively.On prices, Eurozone 2019 inflation forecast was lowered from 1.4% to 1.3%. Similarly, 2020 inflation projection was lowered from 1.4% to 1.3% too. 

UK GDP grew 0.3% mom in May, matched expectations.

-Brent Crude rallied on heavy draw down in US Oil inventory.

Data highlights : -UK industrial production climbed 1.4% m/m and manufacturing production climbed 1.4% m/m.

Thursday’s calendar: – US CPI and weekly jobless claims

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed below major moving averages. 20 day moving average is at 69.15. 50 day moving average is at 69.47.200 day moving average is at 70.78. Daily MACD is in sell zone, implying top at 69.97. Next support is at 68.30. Important resistance is at 69.05 and later at 69.35 .Spot closed at its average level of the day.  

Intra day supports and resistances for July contract are:

PP: 68.71,S1:68.61, S2:68.51, R1:68.81, R2:68.91.                                                         

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

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is between major moving averages. Next Major resistance is at 1.1450. Major support is at 1.1180. Daily MACD is in sell zone, implying an important top at 1.1415. Weekly MACD is in buy zone, implying important bottom at 1.1108.

GBP/USD: The pair is bearish and is trading below major moving averages.Daily MACD  is in sell zone, implying important top at 1.2785 and weekly MACD is  in sell zone, implying important top at 1.3385. Important resistance is at 1.2785 and later at 1.2930. Important support is at 1.2480

USD/YEN: The pair is below  major moving averages. Daily MACD is in buy zone, implying important bottom at 106.80. Next important resistance is at 108.80 and later at 110.40. Important support is at 106.80 and later at 104.50.