USDINR opened at 72.75 y’day and the pair traded in the 72.53-72.76 range. Spot USDINR closed at 72.58, loss of 20 ps for USD as against prior close of 72.78. RBI reference rate was fixed at 72.64 on 27/05. June USD/INR closed at 72.89, loss of 27 ps for USD as compared to prior day’s close of 73.16. June Euro/INR closed at 89, GBP/INR at 103.30 and Yen/INR at 66.84. USDINR fwd premia was trading at around 5.25% p.a. FX market was closed y’day.

In May till date, FII’S have net sold Rs 10742 cr in Equity segment and have net bought Rs 2218 cr of debt. In this financial year, FII’S have net sold Rs 952 Cr worth of Indian Equities and have bought Rs 1117 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.

Benchmark Nifty climbed 0.24%. DOW climbed 141 points (0.41%).Nikkei declined 0.33% and Hang seng declined 0.15%.

Euro is now at 1.2184, Pound at 1.4192, Yen at 109.89.  

Commodities: Gold is now at USD 1896 and WT1Crude at USD 67/Brent at USD 69.50.

Interest rates: USD 10 Yr yield is at 1.60% and 3 m libor closed at 0.155%. Indian 10 yr benchmark yield closed at 5.97%.

Economic news: RBI has warned of asset bubble in the context of 8% contraction in GDP in 2020-21. It called for unwinding of liquidity stimulus measures once the economy is on a solid path of recovery.

According to second estimate, US GDP grew 6.4% annualized in Q1, unrevised.

Data highlights: – US Weekly jobless claims dipped to 406k, durables order declined -1.3% m/m and pending home sales declined -4.4% m/m.

Friday’s calendar: – US personal income, spending and Core PCE index

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed below 50 and 200 day major moving averages. 20 day moving average is at 73.42. 50 day moving average is at 73.52.200 day moving average is at 73.63. Daily MACD is in sell zone, implying top at 75.30. Important support is at 72.25 and important resistance is at 72.75/73.20. Spot closed below its average level of the day.

Intraday supports and resistances for June contract are:

PP: 72.96, S1:72.75, S2:72.62, R1:73.09, R2: 73.30                       

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

However on directional basis, suggest the following:

Expect 72.25-73.20 trading range till either side is broken.

Imports hedging should be done on dips and exports hedging can be done later on rally.

Importers can hedge EURINR exposure now at 88.60.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is above 50 and 200 day moving averages. Major resistance is at 1.2250/1.2330. Next major support is at 1.1990. Daily MACD is in buy zone, implying an important bottom at 1.1990. Weekly MACD is in buy zone, implying important bottom at 1.17.

GBP/USD: The pair is above 200 day moving average. Daily MACD is in buy zone, implying important bottom at 1.38 and weekly MACD is in buy zone, implying important bottom at 1.3665. Important support is at 1.40/1.38.Important resistances is at 1.4250.

USD/YEN: The pair is above 200 day major moving average. Daily MACD is in sell zone, implying important top at 109.80. Next important resistance is at 109.80/111. Important support is at 107.47.

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