FX MORNING UPDATE
USDINR opened at 71.45 y’day and the pair traded in the 71.26-71.48 range. Spot USDINR closed at 71.29 y’day, loss of 8 ps for USD as against prior close of 71.37. RBI reference rate was fixed at 71.43 y’day. Feb USD/INR closed at 71.34, loss of 9 ps for USD as compared to prior day’s close of 71.43. Feb Euro/INR closed at 77.43, GBP/INR at 92.89 and Yen/INR at 64.99.
FII’S nett bought Rs 10425 Cr of Indian Equities in Feb till date . FII’S have nett bought Rs 12262 Cr of Indian debt securities in Feb till date.
Benchmark Nifty declined 0.56% y’day. DOW declined 25 points( 0.09%) y’day. Nikkei declined 0.69% and Hang seng climbed 0.52% y’day.
Euro is now at 1.0831,Pound at 1.3047,Yen at 109.79.
Commodities: Gold is now at USD 1586 and WT1Crude at USD 52.25/Brent at USD 57.55.
Interest rates: USD 10 Yr yield is at 1.59% and 3 m libor closed at 1.71%. Indian 10 yr benchmark yield closed at 6.43%.
Economic news: Chinese central bank cut interest rate on its medium term loans to cushion the impact on the economy from the Wuhan coronavirus outbreak. Also, CNY 100B of liquidity is injected to financial institution through reverse repos. Pboc could cut the benchmark loan prime rate on Thursday.
Japanese GDP contracted -1.6% qoq in Q4, much worse than expectation of -0.9% qoq. In annualized term, GDP contracted -6.3%, biggest contraction in six years.
Data highlights : – No major data release.
Tuesday’s calendar: – US NY Mfrg index
-EU and German Zew sentiment survey
-UK unemployment rate.
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 200 day moving average. 20 day moving average is at 71.24. 50 day moving average is at 71.22.200 day moving average is at 70.60. Daily MACD is in buy zone, implying bottom at 70.73. Important support is at 71.10/70.73 and next important resistance is at 71.65. Spot closed below its average level of the day.
Intra day supports and resistances for Feb contract are:
PP: 71.40,S1:71.26, S2:71.18, R1:71.48, R2:71.62
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 1.10. Major support is at 1.05. Daily MACD is in sell zone, implying an important top at 1.1240. Weekly MACD is in sell zone, implying important top at 1.1240.
GBP/USD: The pair has turned sideways but still above major moving averages.Daily MACD is in buy zone, implying important bottom at 1.2872 and weekly MACD is in sell zone, implying important top at 1.3515. Important resistance is at 1.3285. Important support is at 1.2872 and later at 1.27.
USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 108.30. Next important resistance is at 110.30. Important support is at 108.50/107.70/ 106.50.