USDINR opened at 72.98 on Friday and the pair traded in the 72.73-73.09 range. Spot USDINR closed at 73.03 , gain of 19 ps for USD as against prior close of 72.84. RBI reference rate was fixed at 72.71 on 04/03. Mar USD/INR closed at 73.11, gain of 12 ps for USD as compared to prior day’s close of 72.99. Mar Euro/INR closed at 87.60, GBP/INR at 101.30 and Yen/INR at 67.64.
FII’S nett bought Rs 3243 Cr of Indian Equities in Mar (as on 5/3) . FII’S nett sold Rs 4577 Cr of Indian debt securities in March (as on 3/3) . In this financial year, FII’S have nett bought Rs 261808 Cr of Equities and have sold Rs 35201 Cr in debt. In FY 19-20, FII’s sold Rs 10200 Cr of Equities and 47393 cr of debt.
Benchmark Nifty declined 0.95% on Friday. DOW climbed 572 points(1.85%).Nikkei declined 0.23% and Hang seng declined 0.47% .
Euro closed the week at 1.1918,Pound at 1.3870,Yen at 107.83.
Commodities: Gold is now at USD 1698 and WT1Crude at USD 66.25/Brent at USD 69.54.
Interest rates: USD 10 Yr yield is at 1.58% and 3 m libor closed at 0.23%. Indian 10 yr benchmark yield closed at 6.22%.
Economic news: Rupee volatility continued. USDINR had a range of 36 ps y’day. The rupee weakened 19 ps towards close tracking USD’S rally against majors. Fwd premia continued to soften with 1 year trending down to 4.76% p.a. Indian FX reserves climbed to USD 584.55 bn as on 26/2.
US non-farm payrolls employment grew 379k in February, well above the expectation of 148k. The prior month’s figure was also revised sharply up from 49k to 166k. Overall, total non-farm payroll employment was still down by -9.5m or -6.2% from pre-pandemic level in February 2020. The unemployment rate dropped to 6.2%, down from 6.3%, better than the expectation of 6.4%. average hourly earnings rose 0.2% mom. 10 Year yield surged to 1.6%.
Data highlights: – German factory orders and industrial production.
Monday’s calendar: – EU sentix investor confidence survey.
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 20 day moving average but still below 200 day moving average. 20 day moving average is at 72.84. 50 day moving average is at 73.04.07.200 day moving average is at 74.08. Daily MACD is in buy zone, implying the bottom at 72.30. Important support is at 72.60/72.30 and important resistances are at 73.20/73.50/73.80 . Spot closed above its average level of the day.
Intraday supports and resistances for Mar contract are:
PP:73.13,S1:72.98, S2:72.86, R1:73.25, R2: 73.40
Hedging strategy : Hedging decisions be taken according to comfort and accounting rates.
However, on the directional basis, suggest the following:
An upside break of 74 could end Rupee’s multi-month upward trend. Expect 72.30-73.80 trading range till either side is broken.
Importer hedging should be done on dips to 72.30 and exports can be sold till 73.80 is not broken. If 73.80 is broken, exporters could wait for a higher level to hedge.
EURINR has entered the bearish mode. Exporters can hedge on uptick to 88 and importers can buy EURINR for hedging near the payment period.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below 50 moving average, but above 200 day moving average. Major resistance is at 1.2130. Major support is at 1.18. Daily MACD is in sell zone, implying an important top at 1.2245. Weekly MACD is in the sell zone, implying an important top at 1.2350.
GBP/USD: The pair is above major moving averages. Daily MACD is in sell zone, implying an important top at 1.4240 and weekly MACD is in buy zone, implying important bottom at 1.2675. Important support is at 1.3760/1.3565 . Important resistance is at 1.4250.
USD/YEN: The pair is above 50 and 200-day major moving averages. Daily MACD is in buy zone, implying important bottom at 104.40. The next important resistance is at 109. Important support is at 105.80/104.90.
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