FX MORNING UPDATE
USDINR opened at 75.89 y’day and the pair traded in the 75.48-75.95 range. Spot USDINR closed at 75.50 , loss of 24 ps for USD as against prior close of 75.74. RBI reference rate was fixed at 75.79 y’day. May USD/INR closed at 75.38, loss of 55 ps for USD as compared to prior day’s close of 75.93. May Euro/INR closed at 81.77, GBP/INR at 93.23 and Yen/INR at 70.23.
FII’S have nett bought Rs 15864 Cr of Indian Equities in May . This is due to block deal in HUL shares through book buiding process. FII’S have nett sold Rs 541 Cr of Indian debt securities in May. In FY 19-20, FII’s have sold Rs 10200 Cr of Equities and 47393 cr of debt.
Benchmark Nifty declined 0.46% y’day. DOW declined 457 points (1.89%) y’day. Nikkei declined 0.12% and Hang seng declined 1.45% y’day.
Euro is now at 1.0852,Pound at 1.2268,Yen at 107.19.
Commodities: Gold is now at USD 1705 and WT1Crude at USD 25.40/Brent at USD 29.40.
Interest rates: USD 10 Yr yield is at 0.662% and 3 m libor closed at 0.44%. Indian 10 yr benchmark yield closed at 6.16%.
Economic news: PM announced Rs 20 lac cr stimulus, equivalent to 10% of GDP. FM is to announce details pf the package. PM also announced that there will be reformation in labour, land laws and system. He called for Self reliance and adjustment to new reality.
Indian IIP declined -16.7% in March. Mfrg was down 20.6%, electricity output contracted 6.8%. For the full fiscal year 2019-20, IIP contracted 0.7% as against expansion of 3.8% in 2018-19.
Data highlights : US CPI declined -0.8% m/m.
Wednesday’s calendar:- US PPI
-EU industrial production
-UK GDP , Manufacturing and industrial production
| USD/INR | 75.95 | 75.48 | |
| EUR/USD | 1.0852 | 1.0885 | 1.0784 |
| GBP/USD | 1.2268 | 1.2377 | 1.2255 |
| USD/JPY | 107.19 | 107.71 | 107.12 |
Daily Support/Resistance table
| CurrencyPairs | Pivot | R1 | R2 | R3 | S1 | S2 | S3 |
| EURO/USD | 1.0839 | 1.0894 | 1.0940 | 1.0995 | 1.0793 | 1.0738 | 1.0691 |
| GBP/USD | 1.2297 | 1.2339 | 1.2419 | 1.2462 | 1.2217 | 1.2175 | 1.2095 |
| USD/JPY | 107.32
|
107.52 | 107.90 | 108.10 | 106.93 | 106.74 | 106.35
|
| USD/INR | 75.64 | 75.80 | 76.11 | 75.33 | 75.17 |
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
| Curency Pair | Supports | Resistances | Trend | Remarks |
| EURO/USD | 1.0725/1.0650 | 1.1050/1.1145 | SIDE | UP>1.1050 |
| GBP/USD | 1.2245 | 1.2650/1.2820 | SIDE | DN<1.2245 |
| USD/JPY | 106/105.15/103.10 | 109.40/111.70 | DN | UP>109.40 |
| USD/INR | 75.25/74.90 | 75.80/76.10 | SIDE | UP>76.10 |
| USD/CHF | 0.96 | 0.98/0.99 | DN | UP>0.99 |
Technicals: Spot closed above 200 day moving average. 20 day moving average is at 76.10. 50 day moving average is at 74.82.200 day moving average is at 71.66. Daily MACD is in sell zone, implying top at 76.90. Important support is at 74.90/74.40. Spot closed below its average level of the day.
Intra day supports and resistances for May contract are:
PP:75.60 ,S1:75.12, S2:74.86, R1:75.85, R2: 76.34
Hedging strategy for USD/INR: Hedging decisions be taken according to comfort and accounting rates.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below 200 day major moving average. Next Major resistance is at 1.1050 and later at 1.1150. Major support is at 1.0725 and later at 1.0650. Daily MACD is in buy zone, implying an important bottom at 1.0725. Weekly MACD is in sell zone, implying important top at 1.15.
GBP/USD: The pair has turned sideways and is between major moving averages.Daily MACD is in sell zone, implying important top at 1.2650 and weekly MACD is in sell zone, implying important top at 1.3515. Important resistance is at 1.2650/1.2820. Important support is at 1.2245 and later at 1.2165.
USD/YEN: The pair is below major moving averages. Daily MACD is in sell zone, implying important top at 109.40. Next important resistance is at 111.75. Important support is at 106/105.10.
