FX MORNING UPDATE
USDINR opened at 75.28 on Thursday and the pair traded in the 75.20-75.36 range. Spot USDINR closed at 75.26, loss of 11 ps USD as against prior close of 75.37. RBI reference rate was fixed at 75.31 on 14/10. Oct USD/INR closed at 75.34, loss of 14 ps for USD as compared to prior day’s close of 75.48. Oct Euro/INR closed at 87.47, GBP/INR at 103.30 and Yen/INR at 66.48. USDINR fwd premia was trading at around 4.40% p.a.
|PAIRS||RBI REF RATE (14/10)|
In Oct, FII’S have net bought Rs 962 cr in Equity segment and have net sold Rs 2051 cr of debt. In this financial year, FII’S have net bought Rs 6249 Cr worth of Indian Equities and have bought Rs 17337 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 0.97% on Friday. DOW climbed 382 points (1.09%). Nikkei was up 1.81% and Hang seng climbed 1.48% on Friday.
Euro closed the week at 1.1601, Pound at 1.3750, Yen at 114.25.
Commodities: Gold is now at USD 1768 and WT1Crude at USD 82.53/Brent at USD 84.85.
Interest rates: USD 10 Yr yield is at 1.57% and 3 m libor closed at 0.12%. Indian 10 yr benchmark yield closed at 6.33%.
Economic news: Minutes from the FOMC’s September meeting showed increasing concern among members over the persistence of inflation and a move toward tapering asset purchases. US retail sales was strong, but inflation remains elevated due to shortage of labor in certain services and high energy prices. Supply side issues are also contributing to the inflation scenario.
Data highlights: – US CPI climbed 0.4% m/m. Weekly jobless claims declined to 293k. PPI climbed 0.5% m/m.
-US retail sales climbed 0.7% m/m and NY mfrg index declined to 19.8.
-UK Industrial and manufacturing production climbed 0.8% and 0.5% m/m respectively.
Monday’s calendar: – US industrial production.
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 50 and 100,200 day major moving averages.20 day moving average is at 74.37. 50 day moving average is at 74.05.200 day moving average is at 73.64. Daily MACD is in buy zone, implying bottom at 72.92. Important resistance is at 75.67/76 and important support is at 75.16/75.05/74.93. Spot closed below its average level of the day.
Intraday supports and resistances for Oct contract are:
PP: 75.35 S1:75.26, S2:75.18, R1:75.43, R2:75.52
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USDINR Imports hedging can be done at around 74.70. Exports can be hedged at 75.50.
Exporters can hedge EURINR receivables exposure at 87+.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below 50, 100 and 200 day moving averages. Major resistance is at 1.1640/1.1750. Next major support is at 1.1530/1.1480. Daily MACD is in buy zone, implying an important bottom at 1.1525. Weekly MACD is in sell zone, implying important top at 1.2270.
GBP/USD: The pair is above 50 and 200 day moving averages. Daily MACD is in buy zone, implying important bottom at 1.3410 and weekly MACD is in sell zone, implying important top at 1.4240. Important support is at 1.3650/1.3410. Important resistance is at 1.3840.
USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 109.10. Next important support is at 115. Important support is at 112.10.
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