FX MORNING UPDATE
USDINR opened at 71.26 on Friday and the pair traded in the 71.20-71.43 range. Spot USDINR closed at 71.21 on Friday, loss of 8 ps for USD as against prior close of 71.29. RBI reference rate was fixed at 71.54 on Thursday. Dec USD/INR closed at 71.31, loss of 10 ps for USD as compared to prior day’s close of 71.41. Dec Euro/INR closed at 79.21, GBP/INR at 93.68 and Yen/INR at 65.78.
FII’S nett sold Rs 917 Cr of Indian Equities in Dec . FII’S have nett bought Rs 82573 Cr of Indian Equities in this calendar Year till date. FII’S have nett bought Rs 1233 Cr of Indian debt securities in Dec. FII’S have nett bought Rs 40977 Cr of Indian debt in this calendar year till date.
Benchmark Nifty declined 0.80% on Friday. DOW climbed 337 points (1.22%) on Friday. Nikkei climbed 0.23% and Hang seng climbed 1.07% on Friday.
Euro closed the week at 1.1059 ,Pound at 1.3139,Yen at 108.58.
Commodities: Gold is now at USD 1464 and WT1Crude at USD 59.13./Brent at USD 64.37.
Interest rates: USD 10 Yr yield is at 1.842% and 3 m libor closed at 1.92%. Indian 10 yr benchmark yield closed at 6.67%.
Economic news: US Non-Farm Payroll report showed 266k growth in November, well above expectation of 183K. Job growth averaged 180k per month thus far in 2019, versus 223k monthly average in 2018. Manufacturing jobs rose 54k, versus -43k contraction back in November. Unemployment rate dropped to 3.5%, down from 3.6%, better than expectation of 3.6%. That also matches the lowest since 1969.Participation rate was little changed at 63.2%. Average hourly earnings rose 0.2% mom in November, below expectation of 0.3% mom.
US markets surged, USD gained and Gold declined on strong US jobs data.
Data highlights : – German industrial production declined -1.7% m/m.
Monday’s calendar:- EU sentix investor confidence.
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 100 and 200 day moving average. 20 day moving average is at 71.63. 50 day moving average is at 71.24.200 day moving average is at 70.30. Daily MACD is in sell zone, implying top at 72.25. Important support is at 71.10/70.85 and next important resistance is at 71.65/71.85. Spot closed below its average level of the day.
Intra day supports and resistances for Dec contract are:
PP: 71.39,S1:71.22, S2:71.14, R1:71.47, R2:71.64.
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 1.1120/1.1180. Major support is at 1.0990/1.0940 and later at 1.0870. Daily MACD is in buy zone, implying an important bottom at 1.0990. Weekly MACD is in buy zone, implying important bottom at 1.0870.
GBP/USD: The pair is bullish and is above major moving averages.Daily MACD is in buy zone, implying important bottom at 1.2765 and weekly MACD is in buy zone, implying important bottom at 1.20. Important resistance is at 1.3180. Important support is at 1.2985 and later at 1.2740.
USD/YEN: The pair is above major moving averages. Daily MACD is in sell zone, implying important top at 109.75. Next important resistance is at 110.65. Important support is at 108.25/107.85/ 106.50.