USDINR opened at 72.97 on Wednesday and the pair traded in the 72.89-73.10 range. Spot USDINR closed at 72.91 , loss of 2 ps for USD as against prior close of 72.93. RBI reference rate was fixed at 73.11 on 09/03. Mar USD/INR closed at 73.14, gain of 1 ps for USD as compared to prior day’s close of 73.13. Mar Euro/INR closed at 87.03, GBP/INR at 101.52 and Yen/INR at 67.26. Markets were closed y’day for Maha Sivarathiri.
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 climbed 0.51% on Wednesday. DOW climbed 189 points(0.58%).Nikkei climbed 0.60% and Hang seng climbed 1.65% .
Euro is now at 1.1986,Pound at 1.3999,Yen at 108.86.
Commodities: Gold is now at USD 1723 and WT1Crude at USD 65.88/Brent at USD 69.50.
Interest rates: USD 10 Yr yield is at 1.54% and 3 m libor closed at 0.23%. Indian 10 yr benchmark yield closed at 6.21%.
Economic news: Indian IIP and CPI are to be released today.
ECB maintained status quo, but said that purchase under emergency purchase program will be accelerated within the overall limit to stem possible rise in yields. EU bond yields declined.
US Treasury yields declined after CPI data showed that U.S. inflation remained modest. Yields fell despite the passage by Congress of a $1.9 trillion spending bill which will increase government borrowing further and may overheat the economy.
US Equities rallied as US President signed USD 1.9 trn stimulus package. This package is expected to unleash spending. Equities soared on expectation that considerable liquidity will flow into US and EM Equities.
Data highlights: – US CPI climbed 0.4% m/m, weekly jobless claims declined to 712k.
Wednesday’s calendar: – US PPI
-EU industrial production
-UK industrial and manufacturing production
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 72.85. 50 day moving average is at 73.02.200 day moving average is at 74.08. Daily MACD is in buy zone, implying bottom at 72.30. Important support is at 72.60/72.30 and important resistances are at 73.25/73.50/73.80 . Spot closed below its average level of the day.
Intra day supports and resistances for Mar contract are:
PP:73.13,S1:72.99, S2:72.85, R1:73.27, R2: 73.41
Hedging strategy : Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
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 bearish mode.Exporters can hedge on uptick to 88 and importers can buy EURINR for hedging near 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 sell zone, implying important top at 1.2350.
GBP/USD: The pair is above major moving averages. Daily MACD is in sell zone, implying 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. Next important resistance is at 109. Important support is at 105.80/104.90.
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