FX MORNING UPDATE                                                                                      

USDINR opened at 71.18 y’day and the pair traded in the 70.95-71.22 range. Spot USDINR closed at 71.07 y’day, gain of 5 ps for USD as against prior close of 71.02. RBI reference rate was fixed at 70.97 on Monday. Oct USD/INR closed at 71.18, unchanged for USD as compared to prior day’s close of 71.18. Oct Euro/INR closed at 78.27, GBP/INR at 87.11 and Yen/INR at 66.36.

FII’S have nett sold  Rs 4456 Cr of Indian Equities in Sep . FII’S have nett bought Rs 44917 Cr of Indian Equities in this calendar Year till date. FII’S have nett sold Rs 454 Cr of Indian debt securities in Sep. FII’S have nett bought Rs 29149 Cr of Indian debt in this calendar year till date.

Benchmark Nifty climbed 1.79% y’day. DOW climbed 181 points(0.70%) y’day. Nikkei declined 0.61%  and Hang seng declined 0.81% Y’day.

Euro is now at 1.0965 ,Pound at 1.2218,Yen at 107.16.    

Commodities: Gold is now at USD 1505 and WT1Crude at USD 52.40./Brent at USD 58.

Interest rates: USD 10 Yr yield is at 1.59% and 3 m libor closed at 2.01%. Indian 10 yr benchmark yield closed at 6.45%.        

Economic news: US FOMC minutes indicated that there was three way split over Sept rate cut. While majority favoured 25 bps cut, there was few members who felt that 50 bps rate cut may be necessary to preempt recession. There were also few members who even opposed 25 bps rate cut. FOMC minutes has clouded rate cut outlook going forward.


Data highlights : –  No major data release

Wednesday’s calendar:  US CPI and weekly jobless claims.

USD/INR   71.22 70.95
EUR/USD 1.0990 1.0991 1.0955
GBP/USD 1.2226 1.2292 1.2199
USD/JPY 107.47 107.63 106.94

Daily Support/Resistance table

CurrencyPairs Pivot R1 R2 R3 S1 S2 S3
EURO/USD 1.0977 1.0999 1.1013 1.1035 1.0963 1.0941 1.0927
GBP/USD 1.2234 1.2269 1.2327 1.2362 1.2176 1.2141 1.2084
USD/JPY 107.26


107.58 108.94 108.26 106.90 106.58 106.21



USD/INR 71.08 71.21 71.35   70.94 70.81  



Curency Pair Supports Resistances Trend Remarks
EURO/USD 1.0850 1.1110/1.1250 DN SIDE>1.1110
GBP/USD 1.2240/1.20 1.2585 SIDE DN<1.2240
USD/JPY 107 108.50/109.30 SIDE DN<107
USD/INR 70.85/70.35 71.35/72 SIDE UP>71.50
USD/CHF 0.9840 0.9995 SIDE  UP >0.9995

Technicals: Spot closed above 50 and 200 day moving average. 20 day moving average         is at 71.15. 50 day moving average is at 70.95.200 day moving average is at 70.18. Daily MACD is in sell zone, implying top at 72.40. Important support is at 70.65/70.35 and next important resistance is at 71.35 and later at 72. Spot closed below its average level of the day.  

Intra day supports and resistances for Oct contract are:

PP: 71.20,S1:71.05, S2:70.92, R1:71.33, R2:71.48                                             

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


EURO/USD: The pair is below major moving averages. Next Major resistance is at 1.1110. Major support is at 1.0840. Daily MACD is in sell zone, implying an important top at 1.1110. Weekly MACD is in sell zone, implying important top at 1.1415.

GBP/USD: The pair is sideways and is trading between moving averages, but still below 200 day moving average.Daily MACD  is in sell zone, implying important top at 1.2585 and weekly MACD is  in buy zone, implying important bottom at 1.20. Important resistance is at 1.2580/1.2645. Important support is at 1.2240 and later at 1.20.

USD/YEN: The pair is between  major moving averages. Daily MACD is in sell zone, implying important top at 108.50. Next important resistance is at 108.50. Important support is  at 107.

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