13/07/2018

USDINR opened at 68.74 y’day and the pair traded in the 68.50-68.76 range. Spot USDINR closed at 68.57, loss of 20 ps for USD as against prior close of 68.77.RBI reference rate was fixed at 68.63.July USD/INR closed at 68.67, loss of 25 ps for USD as compared to prior day’s close of 68.92. July Euro/INR closed at 80.15, GBP/INR at 90.79 and Yen/INR at 61.10.

FII’S have bought Rs 496 Cr of Indian Equities in July till date . FII’S have bought Rs 854 Cr of Indian debt securities in June till date . On a cumulative basis, FII’S have bought Rupees 2034 Cr of Indian Equities till date for this calendar year and have sold  Rupees 40436 Cr of Indian debt in this calendar year till date.

Benchmark Nifty climbed 0.68% y’day. DOW declined 218 points (0.99%) y’day.Nikkei climbed 1.17%  and Hang seng climbed 0.60% y’day.

Euro is now at 1.1667, Pound at 1.3180,Yen at 112.60.    

Commodities: Gold is now at USD 1246 and WT1Crude at USD 70.28.

Interest rates: USD 10 Yr yield is at 2.84% and 3 m libor closed at 2.36%. Indian 10 yr benchmark yield closed at 7.87%.        

Economic news: IIP grew only by 3.2% in May as against 4.9% in April. Mfrg climbed 2.8% in April. Consumer durables output remain unchanged month-on-month at 4.3 percent, while consumer non-durables output fell to (-) 2.6 percent in May as compared with 7 percent a month ago. Electricity production grew 4.2 percent in May from 2.1 percent in April, while mining activity’s growth further accelerated at 5.7 percent May from 5.1 in April.

CPI climbed 5% in June as against 4.87% in May. However, Food inflation moderated to 2.9% in June from May’s 3.1%.Fuel inflation grew at 7.14 percent in June from 5.80 percent in May.

European commission cut Eurozone growth. 2018 GDP is projected to grow 2.1%, revised down from Spring forecast of 2.3%. 2019 growth is projected to grow 2.0%, unchanged. On Eurozone inflation, 2018 CPI is projected to be at 1.7%, revised up from 1.5%. 2019 CPI is projected to be at 1.7%, revised up from 1.6%. 

ECB minutes recapped that “policy rates would be kept at their present levels at least through the summer of 2019 and in any case for as long as necessary to ensure that the evolution of inflation remained aligned with a sustained adjustment path”.

Data Highlights : – US CPI climbed 0.1% m/m and weekly jobless claims dipped to 214k.

-EU industrial production climbed 1.3% m/m.      

Friday’s calendar: No major data.

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed above 100 and 200 day major moving averages. 20 day moving is at 68.46. 50 day moving average is at 67.90. 200 day moving average is at 65.50. Daily MACD is in sell zone, implying top at 69.09 . Important support zone is at 68.45 and later at 67.70. Important resistance is at 69.10. Spot closed below its average level of the day.  

Intra day supports and resistances for July contract are:

PP: 68.69,S1:68.56, S2:68.46, R1:68.79, R2:68.92.                                                              

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

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below all major moving averages. Next Major resistance is at 1.1850 and later at 1.1960. Major support is at 1.1508. Daily MACD is in buy zone, implying an important bottom at 1.1508. Weekly MACD is in sell zone, implying important top at 1.2560.

GBP/USD: Trend is bearish in daily chart. Daily MACD  is in buy zone, implying important bottom at 1.3050 and weekly MACD is  in sell zone, implying important top at 1.4375. The pair is trading below all major moving averages. Important resistance is at 1.3475 and later at 1.3550. Important support is at 1.3050.     

USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 109.35. Next important support is at 108.10. Important resistance is  110.92 and later at 111.40.