02/08/2018
USDINR opened at 68.55 y’day and the pair traded in the 68.42-68.62 range. Spot USDINR closed at 68.43, loss of 11 ps for USD as against prior close of 68.54.RBI reference rate was fixed at 68.60. Aug USD/INR closed at 68.64, loss of 13 ps for USD as compared to prior day’s close of 68.77. Aug Euro/INR closed at 80.39, GBP/INR at 90.30 and Yen/INR at 61.50.
FII’S have sold Rs 81 Cr of Indian Equities in July till date . FII’S have sold Rs 1242 Cr of Indian debt securities in June till date . On a cumulative basis, FII’S have bought Rupees 1457 Cr of Indian Equities till date for this calendar year and have sold Rupees 42560 Cr of Indian debt in this calendar year till date.
Benchmark Nifty declined 0.09% y’day. DOW declined 81 points (0.32%) Y’day. Nikkei climbed 0.86% and Hang seng declined 0.85% y’day.
Euro is now at 1.1655, Pound at 1.3110,Yen at 111.62.
Commodities: Gold is now at USD 1218 and WT1Crude at USD 67.89.
Interest rates: USD 10 Yr yield is at 3.00% and 3 m libor closed at 2.36%. Indian 10 yr benchmark yield closed at 7.70%.
Economic news: RBI hiked repo rates by 25 bps to 6.5%. GDP growth for 2018-19 fiscal is retained at 7.4% with growth climbing to 7.5-7.6% in first half. Inflation in second half of this fiscal is expected to be 4.8% and 5% in Q1 of next fiscal. RBI maintained neutral stance citing evenly balanced risks. RBI Governor said that risks emanate from Crude prices, trade and currency wars, financial markets volatility and rising input costs. He also added that capacity utilisation is robust and investment is picking up. Non food credit is growing at 13%. FDI inflows have improved significantly, while FII inflows have declined due to strong USD.
Indian Core sector grew by 6.7% in June. Cement and Coal sector climbed 13.2% and 11.5% respectively. Crude Oil production was down 3.4%. Electricity sector grew by 4%. Core sector has climbed 5.2% in Q1 in this fiscal as compared to 2.5% in Q 1 of last fiscal.In May, Core sector grew by 4.3%.
US is planning to impose 25% tariff on USD 200 bn worth of imports than the earlier proposed 10% tariff. This rattled Global asset markets.
Federal Reserve kept interest rates unchanged on Wednesday, as expected, characterizing the U.S. economy as strong and staying on track to increase borrowing costs in September and likely again in December. US Treasury yields rose as US treasury dept said it would boost borrowing. Japanese and European bond yields also clmbed higher.
Data Highlights : – US ISM(mfrg) declined to 58.1, Price paid component declined to 73.2,ADP employment report showed that pvt sector added 219k jobs, construction spending declined -1.1% m/m.
-EU PMI(mfrg) was finalized at 55.1.
-UK PMI(mfrg) declined marginally to 54.
Thursday’s calendar: US weekly jobless claims and factory orders
-EU PPI
-UK PMI(construction).
| USD/INR | 68.62 | 68.42 | |
| EUR/USD | 1.1655 | 1.1699 | 1.1657 |
| GBP/USD | 1.3110 | 1.3144 | 1.3096 |
| USD/JPY | 111.62 | 112.15 | 111.40 |
Daily Support/Resistance table
| CurrencyPairs | Pivot | R1 | R2 | R3 | S1 | S2 | S3 |
| EURO/USD | 1.1673 | 1.1689 | 1.1715 | 1.1731 | 1.1647 | 1.1631 | 1.1605 |
| GBP/USD | 1.3122 | 1.3148 | 1.3170 | 1.3196 | 1.3100 | 1.3074 | 1.3052 |
| USD/JPY | 111.73
|
112.06 | 112.48 | 112.81
|
111.31 | 110.98 | 110.56
|
| USD/INR | 68.49 | 68.56 | 68.69 | 68.36 | 68.29 |
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
| Curency Pair | Supports | Resistances | Trend | Remarks |
| EURO/USD | 1.1508 | 1.1853/1.1960 | DN | SIDE>1.1853 |
| GBP/USD | 1.2957/1.2770 | 1.3365/1.3475/1.3650 | DN | SIDE>1.3365 |
| USD/JPY | 110.20/109.20 | 113.10 | UP | DN<109 |
| USD/INR | 68.30 | 69.70 | UP | SIDE<68.30 |
| USD/CHF | 0.9785/0.9650 | 1.0060 | UP | DN <0.9785 |
Technicals: Spot closed above 100 and 200 day major moving averages. 20 day moving is at 68.71. 50 day moving average is at 68.20. 200 day moving average is at 65.72. Daily MACD is in sell zone, implying top at 69.10 . Important support zone is at 68.30 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: 68.71,S1:68.57, S2:68.50, R1:68.78, 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 100 and 200 day 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 sell zone, implying an important top at 1.1850. 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 1.2957 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 1.3365 and later at 1.3475/1.3650. Important support is at 1.2957 and later at 1.2770.
USD/YEN: The pair is above major moving averages. Daily MACD is in sell zone, implying important top at 113. Next important support is at 110.20 and later at 109.20. Important resistance is 113.
