USDINR opened at 76.07 y’day and the pair traded in the 76.02-76.24 range. Spot USDINR closed at 76.23, gain of 35 ps for USD as against prior close of 75.87. RBI reference rate was fixed at 76.04 on 14/12. Dec USD/INR closed at 76.40, gain of 45 ps for USD as compared to prior day’s close of 75.95. Dec Euro/INR closed at 86.05, GBP/INR at 101.24 and Yen/INR at 67.10. USDINR fwd premia was trading at around 4.55% p.a.  

In Dec, FII’S have net sold Rs 3078 cr in Equity segment and have net bought Rs 124 cr of debt. In this financial year, FII’S have net bought Rs 3598 Cr worth of Indian Equities and have bought Rs 20201 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 declined 103 points (0.60%). DOW climbed 383 points (1.06%). Nikkei climbed 0.10% and Hang seng declined 0.91% y’day.

Euro is now at 1.1287, Pound at 1.3249, Yen at 114.10.

Commodities: Gold is now at USD 17842and WT1Crude at USD 71.50/Brent at USD 74.40.

Interest rates: USD 10 Yr yield is at 1.46% and 3 m libor closed at 0.17%. Indian 10 yr benchmark yield closed at 6.35%.

Economic news: Rupee declined past 76, tracking USD gains ahead of Fed meeting. U.S. Federal Reserve said it would end bond-buying stimulus in March to set up three interest rate increases next year to tackle heated inflation. “The economy no longer needs increasing amounts of policy support,” Fed Chair Jerome Powell said in a news conference after the conclusion of the two-day policy meeting. Focus is now on BOE meeting.

Data highlights: – US retail sales climbed 0.3% m/m.

-UK CPI climbed 5.1% y/y, RPI climbed climbed 7.1% y/y and PPI(output) climbed 9.1% y/y.

Thursday’s calendar: – US building permits, housing starts, jobless claims and industrial production

-EU PMI(mfrg-flash) and PMI9services-flash)

-BOE meeting

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 75.10. 50 day moving average is at 74.89.200 day moving average is at 73.86. Daily MACD is in buy zone, implying bottom at 73.83. Important resistance is at 76.36/76.90 and important support is at 75.90 and later at 75.68. Spot closed above its average level of the day.

Intraday supports and resistances for Dec contract are:

PP: 76.30, S1:76.15, S2:75.90, R1:76.55, R2:76.70             

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

However on directional basis, suggest the following:

USDINR exports hedging can be done.

Exporters can hedge EURINR receivables exposure closer to 85.75/86.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below 50, 100 and 200 day moving averages. Major resistance is at 1.1535. Next major support is at 1.12. Daily MACD is in buy zone, implying an important bottom at 1.1185. Weekly MACD is in sell zone, implying important top at 1.2270.

GBP/USD: The pair is below 50 and 200 day moving averages. Daily MACD is in sell zone, implying important top at 1.3830 and weekly MACD is in sell zone, implying important top at 1.4240. Important support is at 1.3278. Important resistance is at 1.3515/1.3610.

USD/YEN: The pair is above 200 day, but below 50 day major moving averages. Daily MACD is in sell zone, implying important top at 115. Next important resistance is at 115. Important support is at 112.50.

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