FX MORNING UPDATE

                                                                          

USDINR opened higher at 72.06 y’day and the pair traded in the 71.87-72.25 range. Spot USDINR closed at 71.97 y’day, loss of 11 ps for USD as against prior close of 72.08. RBI reference rate was fixed at 71.70 on Wednesday. Nov USD/INR closed at 72.04, loss of 14 ps for USD as compared to prior day’s close of 72.18. Nov Euro/INR closed at 79.25, GBP/INR at 92.51 and Yen/INR at 66.35.

Rupee recovered y’day as RBI sold USD along with selling by some foreign banks. Rupee decline in the last few days could be attributed  to poor IIP data, paring of sell positions by USD sellers, stronger USD against majors and fears of entrenched GDP slow down. Moody’s action in changing outlook to negative from stable and continued USD buying by RBI at lower levels are also contributory factors to Rupee weakness. However, overall inflows is good and CNY is steady against USD. Rupee seems to have broken coorrelation with CNY.

FII’S nett bought  Rs 4444 Cr of Indian Equities in Oct . FII’S have nett bought Rs 64694 Cr of Indian Equities in this calendar Year till date. FII’S have nett bought Rs 4617 Cr of Indian debt securities in Oct. FII’S have nett bought Rs 47775 Cr of Indian debt in this calendar year till date.

Benchmark Nifty climbed 0.27% y’day. DOW declined 1 point (0.01%) y’day. Nikkei declined 0.76%  and Hang seng declined 0.93%  y’day.

Euro is now at 1.1023 ,Pound at 1.2885,Yen at 108.58.    

Commodities: Gold is now at USD 1468 and WT1Crude at USD 57.02./Brent at USD 62.52.

Interest rates: USD 10 Yr yield is at 1.815% and 3 m libor closed at 1.93%. Indian 10 yr benchmark yield closed at 6.52%.                                                                    

Economic news: Eurozone GDP grew 0.2% qoq in Q3, unchanged from Q2, matched expectations. Over the year, GDP grew 1.2% yoy. Employment grew 0.1% qoq, below expectation of 0.2% qoq. German GDP grew 0.1% qoq in Q3, beat expectation of -0.1% qoq.

Data highlights : – US PPI climbed 0.4% m/m and weekly jobless claims climbed to 225k.

-UK retail sales declined -0.1% m/m.

Friday’s calendar: – EU PMI(services)

USD/INR   72.25 71.87
EUR/USD 1.1023 1.1027 1.0989
GBP/USD 1.2885 1.2885 1.2825
USD/JPY 108.58 108.86 108.25

Daily Support/Resistance table

CurrencyPairs Pivot R1 R2 R3 S1 S2 S3
EURO/USD 1.1012 1.1035 1.1050 1.1074 1.0997 1.0974 1.0958
GBP/USD 1.2865 1.2905 1.2928 1.2967 1.2842 1.2802 1.2779
USD/JPY 108.54

 

108.83 109.15 109.44 108.22 107.93 107.61

 

USD/INR 72.03 72.25 72.47   71.87 71.71  

 

 

 

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Curency Pair Supports Resistances Trend Remarks
EURO/USD 1.10/1.0870 1.1180 DN UP>1.1180
GBP/USD 1.2705/1.2585 1.30 UP DN<1.2440
USD/JPY 107.90/106.50 110.65 UP DN<107.50
USD/INR 71.75/71.35 72.45 UP DN<70.55
USD/CHF 0.9970 0.9840 UP DN<0.9840

Technicals: Spot closed above 100 and 200 day moving average. 20 day moving average       is at 71.10. 50 day moving average is at 71.22.200 day moving average is at 70.28. Daily MACD is in buy zone, implying bottom at 70.55. Important support is at 71.75 and next important resistance is at 72.45. Spot closed below its average level of the day.  

Intra day supports and resistances for Nov contract are:

PP: 72.01,S1:71.88, S2:71.60, R1:72.30, R2:72.42                                          

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 1.1180. Major support is at 1.10 and later at 1.0870. Daily MACD is in sell zone, implying an important topo at 1.1185. Weekly MACD is in buy zone, implying important bottom at 1.0870.

GBP/USD: The pair is sideways but is still trading above 200 day moving average.Daily MACD  is in sell zone, implying important top at 1.30 and weekly MACD is  in buy zone, implying important bottom at 1.20. Important resistance is at 1.30/1.31. Important support is at 1.2705 and later at 1.2550.

USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 107.85. Next important resistance is at 110.65. Important support is  at 107.85/106.50.

 

 

 

 

 

 

 

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