FX MORNING UPDATE
USDINR opened at 75.57 y’day and the pair traded in the 75.55-75.86 range. Spot USDINR closed at 75.80 , gain of 16 ps for USD as against prior close of 75.64. RBI reference rate was fixed at 75.67 y’day. May USD/INR closed at 75.73, gain of 5 ps for USD as compared to prior day’s close of 75.68. May Euro/INR closed at 82.86, GBP/INR at 92.83 and Yen/INR at 70.33.
FII’S have nett bought Rs 12638 Cr of Indian Equities in May . This is due to block deal in HUL shares through book buiding process. FII’S have nett bought Rs 1992 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 climbed 2.11% y’day. DOW climbed 369 points (1.51%) y’day. Nikkei climbed 1.49% and Hang seng climbed 1.89% y’day.
Euro is now at 1.0960,Pound at 1.2198,Yen at 107.66.
Commodities: Gold is now at USD 1746 and WT1Crude at USD 33.55/Brent at USD 35.90.
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 6.04%.
Economic news: Minutes from the U.S. Federal Reserve’s April meeting released on Wednesday showed policymakers affirmed a pledge to keep interest rates near zero until they are confident the economy is on track to recovery. Euro was supported by a proposal to have commom fund that could move the region closer to a fiscal union. Oil gained as Countries have begun to ease lock down restrictions.
Data highlights : EU CPI was finalized at 0.3% y/y and consumer confidence
-UK CPI declined -0.2% m/m, RPI slowed to 1.5% y/y and PPI(output) declined -0.8% m/m.
Thursday’s calendar:- US weekly jobless claims, Phily fed index and existing home sales
-UK PMI(mfrg), PMI(services)
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 200 day moving average. 20 day moving average is at 75.97. 50 day moving average is at 75.20.200 day moving average is at 72.10. Daily MACD is in sell zone, implying top at 76.90. Important support is at 75.25/74.90. Spot closed above its average level of the day.
Intra day supports and resistances for May contract are:
PP:75.71 ,S1:75.51, S2:75.28, R1:75.94, R2: 76.14
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 sell zone, implying an important top at 1.1020. Weekly MACD is in sell zone, implying important top at 1.15.
GBP/USD: The pair has turned bearish and is below 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 1.2250/1.2650. Important support is at 1.1945 and later at 1.14.
USD/YEN: The pair is below major moving averages. Daily MACD is in buy zone, implying important bottom at 106. Next important resistance is at 109.40 and later at 111.75. Important support is at 106/105.10.