FX MORNING UPDATE

USDINR opened at 72.76 y’day and the pair traded in the 72.65-72.79 range. Spot USDINR closed at 72.65 , loss of 10 ps for USD as against prior close of 72.75. RBI reference rate was fixed at 72.83 on 17/02Feb USD/INR closed at 72.63, loss of 17 ps for USD as compared to prior day’s close of 72.80. Feb Euro/INR closed at 87.71, GBP/INR at 101.22 and Yen/INR at 68.78.

FII’S nett bought Rs 24936 Cr of Indian Equities in Feb . FII’S nett sold Rs 624 Cr of Indian debt securities in Jan . In this financial year, FII’S have nett bought Rs 255583 Cr of Equities and have sold Rs  25886 Cr in debt. In FY 19-20, FII’s sold Rs 10200 Cr of Equities and 47393 cr of debt.

Benchmark Nifty declined 0.59% y’day. DOW declined 119 points(0.38%).Nikkei declined 0.19% and Hang seng declined 1.58% .

Euro is now at 1.2049,Pound at 1.3868,Yen at 105.77.      

Commodities: Gold is now at USD 1761 and WT1Crude at USD 59.50/Brent at USD 63.

Interest rates: USD 10 Yr yield is at 1.29% and 3 m libor closed at 0.23%. Indian 10 yr benchmark yield closed at 6.13%.

Economic news: Indian bond yields surged. Rupee gained on debt related inflows.

FOMC minutes for the January meeting revealed that policymakers were cautiously optimistic over the economic outlook. Meanwhile, it also dampened hopes of tapering. The minutes reaffirmed the guidance that asset purchases would continue at the current pace “until substantial further progress toward its employment and inflation goals had been achieved”.  

Data highlights: – US Weekly jobless claims climbed to 861k, building permits climbed to 1.88 mn and housing starts dipped to 1.58 mn.

Friday’s calendar: – US existing home sales

-EU PMI(mfrg-flash) and PMI(services-flash)

-UK retail sales and PMI(mfrg)

USD/INR   72.79 72.65
EUR/USD 1.2092 1.2096 1.2035
GBP/USD 1.3971 1.3986 1.3839
USD/JPY 105.69 105.93 105.60

Daily Support/Resistance table

Currency Pairs Pivot R1 R2 R3 S1 S2 S3
EURO/USD 1.2074 1.2113 1.2134 1.2173 1.2052 1.2014 1.1992
GBP/USD 1.3931 1.4023 1.4077 1.4169 1.3876 1.3785 1.3730
USD/JPY 105.73

 

105.86 106.06 106.19 105.53 105.40

 

105.21

 

USD/INR 72.70 72.74 72.84   72.61 72.56

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Currency Pair Supports Resistances Trend Remarks
EURO/USD 1.1950 1.2145/1.2220/1.2350 SIDE UP>1.2150
GBP/USD 1.3565 1.4050 UP DN<1.3565
USD/JPY 104.40 105.70 SIDE DN<103.95
USD/INR 72.40 72.90/73.10 DN SIDE>73.50
USD/CHF 0.8890 0.8990/0.9045 DN UP>0.9045

Technicals: Spot closed below 100 and 200 day moving average. 20 day moving average is at 72.89. 50 day moving average is at 73.18.200 day moving average is at 74.27. Daily MACD is in sell zone, implying top at 73.50. Important support is at 72.40 and important resistance is at 73.10/73.50 . Spot closed below its average level of the day.

Intra day supports and resistances for Feb contract are:

PP:72.69,S1:72.53, S2:72.45, R1:72.78, R2: 72.93.                        

Hedging strategy for USD/INR: Hedging decisions be taken according to comfort and accounting rates.

CROSS CURRENCY TECHNICALS:

EURO/USDThe pair is below 20 and 50 moving averages, but above 100 and 200 day moving average. Major resistance is at 1.2150. Major support is at 1.1950. Daily MACD is in buy zone, implying an important bottom at 1.1950. Weekly MACD is in buy zone, implying important bottom at 1.1610.

GBP/USD: The pair is above major moving averages. Daily MACD  is in buy zone, implying important bottom at 1.3565 and weekly MACD is  in buy zone, implying important bottom at 1.2675. Important support is at 1.3565 . Important resistance is at 1.4050.

USD/YEN: The pair is above 50 day major moving average, but still below 200 day moving average . Daily MACD is in sell zone, implying important top at 105.75. Next important resistance is at 105.75. Important support is at 104.40/104.

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