FX MORNING UPDATE             

USDINR opened at 75.12 on Friday and the pair traded in the 74.88-75.13 range. Spot USDINR closed at 75.04, loss of 4 ps for USD as against prior close of 75.08. RBI reference rate was fixed at 74.95 on 28/01Feb USD/INR closed at 75.34, loss of 5 ps for USD as compared to prior day’s close of 75.39. Feb Euro/INR closed at 83.98, GBP/INR at 100.88 and Yen/INR at 65.20. USDINR fwd premia was trading at around 4.53% p.a.  

USDINR 74.95
EURINR 83.60
GBPINR 100.51
JPYINR 64.95

In Jan, FII’S have net sold Rs 27506 cr in Equity segment and have net bought Rs 3615 cr of debt. In this financial year, FII’S have net sold Rs 32722 Cr worth of Indian Equities and have bought Rs 6508 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 8 points (-0.05%). DOW climbed 565 points (1.65%). Nikkei climbed 2.09% and Hang Seng declined -1.08% y’day.

Euro closed at 1.1150, Pound at 1.3408, Yen at 115.22.

Commodities: Gold is now at USD 1782 and WT1Crude at USD 87.30/Brent at USD 89.

Interest rates: USD 10 Yr yield is at 1.78% and 3 m libor closed at 0.27%. Indian 10 yr benchmark yield closed at 6.77%.

Economic news: German GDP dropped -0.7% qoq in Q4, worse than expectation of -0.2% qoq. GDP was still -1.5% lower than pre-pandemic level in Q4, 2021. For whole of 2021, GDP grew 2.8%.

US income data and PCE index data were lower than expected. US 10 Year yield corrected lower to 1.78%, providing relief rally to US Equities.

Data highlights: – US personal income climbed 0.3% m/m and spending declined -0.6% m/m. Core PCE index climbed 0.5% m/m.

Monday’s calendar: – US Chicago PMI

USD/INR      75.12 74.88
EUR/USD      1.1150 1.1173 1.1122
GBP/USD      1.3408 1.3434 1.3365
USD/JPY      115.22 115.69 115.13

Daily Support/Resistance table

Currency Pairs Pivot R1 R2 R3 S1 S2 S3
EURO/USD 1.1148 1.1174  1.1199   1.1123 1.1097  
GBP/USD 1.3402 1.3439  1.3471    1.3370 1.3333  
USD/JPY 115.34 115.56  115.90    114.99 114.78  
USD/INR 75.01 75.15 75.27   74.89 74.75  


Currency Pair Supports Resistances Trend Remarks
EURO/USD 1.11 1.1365/1.1480 DN UP>1.17
GBP/USD 1.3170 1.3750/1.3850 DN UP>1.3750
USD/JPY 112.50 116.30 UP DN<112.50
USD/INR 74.90/74.75 75.35/75.60 UP DN<74.70
USD/CHF 0.9085 0.9275/0.9375 SIDE DN<0.9085

Technicals: Spot closed above 200 day major moving averages.20 day moving average is at 74.40. 50 day moving average is at 74.88.200 day moving average is at 74.10. Daily MACD is in buy zone, implying bottom at 73.80. Important resistance is at 75.35/75.60 and important support is at 74.90/74.72. Spot closed above its average level of the day.

Intraday supports and resistances for Feb contract are:

PP: 75.31, S1:75.16, S2:74.97, R1:75.49, R2:75.65.             

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

However on directional basis, suggest the following:

USDINR exports can be hedged at 75.50 +.


EURO/USD: The pair is below all major moving averages. Major resistance is at 1.1485. Next major support is at 1.11.. Daily MACD is in sell zone, implying an important top at 1.1485. Weekly MACD is in sell zone, implying important top at 1.2270.

GBP/USD: The pair is above 50 ,but below 200 day moving averages. Daily MACD is in sell zone, implying important bottom at 1.3170 and weekly MACD is in sell zone, implying important top at 1.3750. Important support is at 1.3170. Important resistance is at 1.3750/1.3850.

USD/YEN: The pair is above 100 and 200 day major moving averages., but below 20 and 50 day moving averages. Daily MACD is in sell zone, implying important top at 116.35. Next important resistance is at 116.35. Important support is at 112.50

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