USDINR opened at 77.99 y’day and the pair traded in the 77.99-78.09 range. Spot USDINR closed at 78.07, gain of 7 ps for USD as against prior close of 78. RBI reference rate was fixed at 78.07 on 15/06. June USD/INR closed at 78.25, gain of 14 ps for USD as compared to prior day’s close of 78.11. June Euro/INR closed at 82.14, GBP/INR at 94.90 and Yen/INR at 58.28. USDINR fwd premia was trading at around 3.30% p.a.  FX reserves stands at USD 601.1 bn.

In 2022-23 fiscal, FII’S have sold 59281 Cr of Equities till date and have sold Rs 7298 Cr of debt 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 40 points (0.25%) y’day. DOW climbed 303 points. (1%).Nikkei declined 1.14% and Hang Seng climbed 1.14%.

Euro is now at 1.0447, Pound at 1.2165, Yen at 134.40.

Commodities: Gold is now at USD 1834 and WT1Crude at USD 117/Brent at USD 120.

Interest rates: USD 10 Yr yield is at 3.34% and 3 m libor closed at 1.74%. Indian 10 yr benchmark yield closed at 7.60%.

Economic news: India’s May trade deficit expanded to US D 24.29 bn. Exports rose 20.55% to USD 38.94 bn and Imports rose 62.83% to USD 63.22 bn. Cumulative exports in April-May 2022-23 rose by about 25% to $78.72 billion. Imports in April-May 2022-23 rose 45.42% to $123.41billion.

Fed raised its benchmark rate by a larger than expected 0.75%, with Fed Chairman Jerome Powell admitting that the recent upside inflation had forced the central bank’s hand into tightening monetary policy by more than expected. 

In the press conference that followed, Powell said there was a need to “front load” rate hikes, signaling the aggressive hikes now may not be followed up in the future with similarly aggressive hikes.  

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

-EU industrial production climbed 0.4% m/m.

Thursday’s calendar :  US Weekly jobless claims, housing starts, building permits and Phily Fed index

-UK MPC meeting.

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 77.68. 50 day moving average is at 76.97.200 day moving average is at 75.30. Daily MACD is in buy zone. Important supports are at 77.80 and important resistance is at 78.25. Spot closed above its average level of the day.

Intraday supports and resistances for June contract are:

PP: 78.18, S1:78.05, S2:77.86, R1:78.37, R2:78.50.             

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

However on directional basis, suggest the following:

USDINR Exports can be partially hedged at 78.25+ levels. Nearby imports can be hedged at 77.80.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below major moving averages. Major resistance is at 1.0790. Next major support is at 1.0350. Daily MACD is in sell zone, implying an important top at 1.0790. Weekly MACD is in sell zone, implying important top at 1.1498.

GBP/USD: The pair is below 50 and 200 day moving averages. Daily MACD is in sell zone, implying important top at 1.2660 and weekly MACD is in sell zone, implying important top at 1.3730. Important support is at 1.2165. Important resistance is at 1.2660/1.28.

USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 126.30. Important support is at 126.30/125. Major resistance is at 131.30.

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