USDINR opened at 76.13 y’day and the pair traded in the 75.99-76.29 range. Spot USDINR closed at 76.26, loss of 16 ps for USD as against prior close of 76.42. RBI reference rate was fixed at 76.08 on 05/05. May USD/INR closed at 76.52, loss of 9 ps for USD as compared to prior day’s close of 76.61. May Euro/INR closed at 80.90, GBP/INR at 95.25 and Yen/INR at 59. USDINR fwd premia was trading at around 4.15% p.a.  FX reserves stands at USD 603.69 bn as on 22/4.

In 2022-23, FII’S have sold 5401 Cr of Equities in April till date and have sold Rs 1193 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 closed flat (0%) y’day. DOW declined 1039 points (3.12%).Nikkei declined 0.11% and Hang Seng declined 0.36%.

Euro is now at 1.0534, Pound at 1.2346, Yen at 130.62.

Commodities: Gold is now at USD 1870 and WT1Crude at USD 108/Brent at USD 110.35.

Interest rates: USD 10 Yr yield is at 3.07% and 3 m libor closed at 1.36%. Indian 10 yr benchmark yield closed at 7.40%.

Economic news: USDINR fwd premia climbed to 4.15% per annum for 1 year, tracking hike in repo rates. 10 Year yield jumped further to 7.4%.

Bank of England (BoE) hiked the Bank Rate by another 25bp to 1.00%. BoE kept the softer forward guidance in place by stating “some degree of further tightening in monetary policy may still be appropriate in the coming months” BOE’S statement has sent a mixed signal due to disagreement over members on forward guidance. Considering inflation sustainability, BOE may still increase rates by 25 bps at least twice before this year.

Pound declined further after BOE meeting.

Global investor sentiment cratered again , fearing that recent rate hikes would not be able to tame inflation. Worries about Fed policy moves, mixed earnings from some big growth companies, the conflict in Ukraine and pandemic-related lockdowns in China have hammered markets down.

Data highlights: – US Weekly jobless claims climbed to 200k.

-German factory orders declined 4.7% m/m.

-UK PMI(services) climbed to 58.9.

Friday’s calendar: – US non farm payrolls

-German industrial production

-UK PMI(construction)

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed above 200 day major moving averages.20 day moving average is at 76.20. 50 day moving average is at 76.200 day moving average is at 74.88. Daily MACD is in sell zone, implying top at 76.78. Important resistance is at 76.78 and important supports are at 76 and 75.70. Spot closed above its average level of the day.

Intraday supports and resistances for May contract are:

PP: 76.41, S1:76.29, S2:76.06, R1:76.64, 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 76.40.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below major major moving averages. Major resistance is at 1.08. Next major support is at 1.0475/1.0340.. 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 1.2410/1.2260. Important resistance is at 1.2750/1.2850.

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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