FX – MORNING UPDATE :             

USDINR opened at 76.28 on Friday and the pair traded in the 76.20-76.49 range. Spot USDINR closed at 76.48, gain of 32 ps for USD as against prior close of 76.16. RBI reference rate was fixed at 76.33 on 22/04. Apr USD/INR closed at 76.45, gain of 24 ps for USD as compared to prior day’s close of 76.21. Apr Euro/INR closed at 82.75, GBP/INR at 98.75 and Yen/INR at 59.68. USDINR fwd premia was trading at around 3.95% p.a.  FX reserves fell USD 2.47 bn and is at USD 604 bn as on April 8 th.

PAIRSRBI REF RATE (22/04)
USDINR76.33
EURINR82.78
GBPINR99.30
JPYINR59.65

In 2022-23, FII’S have sold 2861 Cr of Equities in April till date and have sold Rs 54 Cr of debt in April, till date. In 2021-22, FII’S net sold Rs 128897 cr in Equity segment and have net bought Rs 4805 cr of 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 220 points (1.27%) y’day. DOW declined 981 points (2.82%).Nikkei declined 1.63% and Hang Seng declined 0.21%.

Euro is now at 1.0794, Pound at 1.2838, Yen at 128.57.

Commodities: Gold is now at USD 1932 and WT1Crude at USD 101.75/Brent at USD 106.20.

Interest rates: USD 10 Yr yield is at 2.90% and 3 m libor closed at 1.06%. Indian 10 yr benchmark yield closed at 7.16%.

Economic news: Rupee fell 32 ps, tracking rise of USD after Fed Chief’s comments on accelerated rate hikes. Steep decline in Equities and reports of downsized LIC IPO also soured sentiments.

UK retail sales dropped -1.4% mom in March, much worse than expectation of -0.3% mom. Sterling declined after weak retail sales report.

According to German Central bank, German GDP could be up to -5% lower than March forecast by the ECB. Compared to 2021, GDP would fall by almost -2% in 2022.

Price increase could be significant, with inflation 1.5% higher in 2022, and 2% higher in 2023 than ECB forecast. “The upward risks of inflation predominate, since price increases in downstream production stages or wage increases could be greater.”

Data highlights: – – EU PMI(flash-mfrg) improved to 55.3 and PMI(flash-services) improved to 57.7.

– UK PMI(flash-mfrg) climbed to 55.3 and PMI(flash-services) dipped to 58.3.

Monday’s calendar: -German Ifo survey.

USD/INR   76.4976.20
EUR/USD     1.07941.08531.0770
GBP/USD     1.28381.30371.2822
USD/JPY     128.57129.12128.74

Daily Support/Resistance table

Currency PairsPivotR1R2R3S1S2S3
EURO/USD1.08051.08411.0888 1.0757 1.0722 
GBP/USD1.28991.2976 1.3114  1.27611.2674 
USD/JPY128.81128.88129.19  128.50128.43 
USD/INR76.3976.5876.68 76.2976.10 

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Currency PairSupportsResistancesTrendRemarks
EURO/USD1.08051.1180DNSIDE>1.1185
GBP/USD1.26501.30/1.3175DNUP>1.33
USD/JPY121.10/118..70UPDN<116.40
USD/INR76.10/75.7076.50/76.70UPSIDE<76.10
USD/CHF0.93750.9625SIDEDN<0.9375

Technicals: Spot closed above 200 day major moving averages.20 day moving average is at 76.05. 50 day moving average is at 75.80.200 day moving average is at 74.83. Daily MACD is in buy zone, implying bottom at 75.30. Important resistance is at 76.50/76.70 and important supports are at 76.10/75.70. Spot closed above its average level of the day.

Intraday supports and resistances for Apr contract are:

PP: 76.41, S1:76.25, S2:76.06, R1:76.60, R2:76.76.             

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 76.70//77.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below major major moving averages. Major resistance is at 1.1180/1.1485. Next major support is at 1.0650.. Daily MACD is in sell zone, implying an important top at 1.1185. Weekly MACD is in sell zone, implying important top at 1.1498.

GBP/USD: The pair is below all moving averages. Daily MACD is in sell zone, implying important top at 1.33 and weekly MACD is in sell zone, implying important top at 1.3730. Important support is at 1.2650. Important resistance is at 1.30/1.3175.

USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 114.40. Important support is at 121.10/118.70.

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