USDINR opened at 74.25 Y’day and the pair traded in the 73.91-74.33 range. Spot USDINR closed at 73.93, loss of 14 ps for USD as against prior close of 74.07. RBI reference rate was fixed at 74.18 on 03/05. May USD/INR closed at 74.33, loss of 2 ps for USD as compared to prior day’s close of 74.35. May Euro/INR closed at 89.60, GBP/INR at 103.15 and Yen/INR at 67.93. While USDINR Spot declined, fwds climbed to offset Rupee gains. Fwd rally is attributed to RBI’S roll over of existing swap positions. Cash discount rate also continued to be steep. 1 Year fwd premia climbed to 5.10% p.a.

In April till date, FII’S have net bought Rs 2355 Cr worth of Indian Equities and have sold Rs 1101 Cr worth of Indian debt. In 2020-21 financial Year, FII’S nett bought Rs 2,74,203 Cr of Equities and have sold Rs  42820 Cr in debt. In FY 19-20, FII’s sold Rs 10200 Cr of Equities and 47393 cr of debt.

Benchmark Nifty closed flat y’day. DOW climbed 238 points (0.70%).Nikkei declined 0.83% and Hang seng declined 1.38%.

Euro is now at 1.2054, Pound at 1.3895, Yen at 109.13.  

Commodities: Gold is now at USD 1789 and WT1Crude at USD 64.55/Brent at USD 67.45.

Interest rates: USD 10 Yr yield is at 1.60% and 3 m libor closed at 0.19%. Indian 10 yr benchmark yield closed at 6.02%.

Economic news: Indian PMI(mfrg) climbed to 55.5 in April vs consensus of 51.6. Global PMI data were also robust. Focus is now on US employment data.

Data highlights: – US ISM(mfrg) was below consensus at 60.7 and construction spending climbed 0.2% m/m.

-German retail sales climbed 7.7% m/m and PMI(mfrg) climbed to 62.9.

Tuesday’s calendar: – US factory orders

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed above 50 and 200 day major moving averages. 20 day moving average is at 74.35. 50 day moving average is at 73.35.200 day moving average is at 73.76. Daily MACD is in sell zone, implying top at 75.30. Important support is at 73.95/73.80 and important resistance is at 74.28/74.62/74.90. Spot closed below its average level of the day.

Intraday supports and resistances for May contract are:

PP: 74.44, S1:74.20, S2:74.07, R1:74.57, R2: 74.81                       

Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.

However on directional basis, suggest the following:

Expect 73.80-75.50 trading range till either side is broken.

Imports hedging should be done on dips to 73.80 and exports hedging can be done closer to 75.30.

Importers can hedge EURINR exposure at 88.60.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is above 50 and 200 day moving averages. Major resistance is at 1.2150/1.2250. Next major support is at 1.1990 and later at 1.1935. Daily MACD is in buy zone, implying an important bottom at 1.17. Weekly MACD is in sell zone, implying important top at 1.2350.

GBP/USD: The pair is above 200 day moving average. Daily MACD is in sell zone, implying important top at 1.4010 and weekly MACD is in sell zone, implying important top at 1.4237. Important support is at 1.3670/1.3565.Important resistances are at 1.4010/1.4250.

USD/YEN: The pair is above all major moving averages. Daily MACD is in buy zone, implying important bottom at 107.47. Next important resistance is at 110/111. Important support is at 107.47.

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