USDINR opened at 75.05 on Friday and the pair traded in the 74.91-75.05 range. Spot USDINR closed at 74.93 , unchanged for USD as against prior close of 74.93. RBI reference rate was fixed at 74.85 on Friday. Aug USD/INR closed at 75.12, gain of 1 ps for USD as compared to prior day’s close of 75.11. Aug Euro/INR closed at 88.76, GBP/INR at 98.22 and Yen/INR at 71.12. Rupee continues to move sideways despite USD decline against crosses due to RBI intervention at 74.70. Covid cases continue to surge forcing localised lockdowns impairing economic recovery.
FII’S have nett bought Rs 390 Cr of Indian Equities in August till date . FII’S have nett bought Rs 587 Cr of Indian debt securities in July. In FY 19-20, FII’s have sold Rs 10200 Cr of Equities and 47393 cr of debt.
Benchmark Nifty climbed 0.12% on Friday. DOW climbed 46 points (0.12%) on Friday.Nikkei declined 0.39% and Hang seng declined 1.60% on Friday.
Euro closed the week at 1.1788,Pound at 1.3132,Yen at 105.56.
Commodities: Gold is now at USD 2036 and WT1Crude at USD 41.56/Brent at USD 44.66.
Interest rates: USD 10 Yr yield is at 0.56% and 3 m libor closed at 0.27%. Indian 10 yr benchmark yield closed at 5.88%.
Economic news: US non-farm payroll employment grew 1763k in July, above expectation of 1510k. Unemployment rate edged lower to 10.9% and average hourly earnings rose 0.2% m/m. US Congress is still divided over the stimulus package details. Focus will be on escalating US-Sino tech war with US banning Chinese Tik Tok and threatening sanctions on companies dealing with bytedance.
Gold extended its rally due to liquidity and uncertainity. Silver accompanied Gold in its rally.
Data highlights : -German industrial production climed 8.9% m/m.
Monday’s calendar: – No major data release.
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 200 day moving average. 20 day moving average is at 74.96. 50 day moving average is at 75.30.200 day moving average is at 73.35. Daily MACD is in buy zone, implying bottom at 74.50. Important support is at 74.50 and important resistance is at 75.50. Spot closed below its average level of the day.
Intra day supports and resistances for Aug contract are:
PP:75.13,S1:75.01, S2:74.92, R1:75.23, R2: 75.34
Hedging strategy for USD/INR: Hedging decisions be taken according to comfort and accounting rates.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is above 50 and 200 day major moving average. Next Major resistance is at 1.21. Major support is at 1.1420 with first support at 1.17. Daily MACD is in buy zone, implying an important bottom at 1.1165. Weekly MACD is in buy zone, implying important bottom at 1.0650.
GBP/USD: The pair has turned bullish and is above major major moving averages.Daily MACD is in buy zone, implying important bottom at 1.2250 and weekly MACD is in buy zone, implying important bottom at 1.14. Important support is at 1.2850 and later at 1.2670. Important resistance is at 1.32.
USD/YEN: The pair is below major moving averages. Daily MACD is in buy zone, implying important bottom at 104.10. Next important resistance is at 106 and later at 106.65. Important support is at 104.10.