USDINR opened gap down at 79.54 on Friday and the pair traded in the 79.16-79.56 range. Spot USDINR closed at 79.26, loss of 49 ps for USD as against prior close of 79.75. In June, USDINR closed at 78.97. Rupee fell 29 ps in July on close to close basis, though it hit a month and record low of 80.06. RBI’S frequent intervention contained Rupee fall beyond 80.06.
RBI reference rate was fixed at 79.42 on 29/07. Aug USD/INR closed at 79.47, loss of 43 ps for USD as compared to prior day’s close of 79.90. Aug Euro/INR closed at 81.43, GBP/INR at 96.74 and Yen/INR at 59.68. USDINR fwd premia was trading at around 3.18% p.a. FX reserves stands at USD 571 bn as on July 29 th.
|PAIRS||RBI REF RATE (29/07)|
In July till date FII’S have net sold Rs 1200 Cr of Equities in Cash segment and have sold Rs 1130 Cr of debt till date. In this Calendar Year, FII’S have sold close to Rs 2.02 lac Cr worth of Equities. 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 climbed 332 points (1.03%) on Friday. DOW climbed 315 points (0.97%). Nikkei declined 0.05% and Hang Seng declined 2.26%.
Euro closed at 1.0226, Pound at 1.2176, Yen at 133.21.
Commodities: Gold is now at USD 1764 and WT1Crude at USD 98/Brent at USD 104.
Interest rates: USD 10 Yr yield is at 2.65% and 3 m libor closed at 2.73%. Indian 10 yr benchmark yield closed at 7.32%.
Economic news: Rupee gained 49 ps as market pared expectations of aggressive rate hike in US, following GDP contraction in Q2. USDJPY declined steeply and was tracked by EM Currencies. Steep climb in Indian Equity markets and inflows due to 5-G auctions also added to positive sentiment.
Eurozone GDP grew 0.7% qoq in Q2, well above expectation of 0.1% qoq. Compared with same quarter of last year, GDP grew 4.0% yoy. EU inflation rose to record high.
Data highlights: – US Personal income climbed 0.6% m/m, spending climbed 1.1% m/m and Core PCE index climbed 0.6% m/m.
-EU CPI (flash) climbed 8.9% y/y.
Monday’s calendar : – US ISM(mfrg) and construction spending
-EU unemployment rate, PMI(mfrg-final) and German retail sales.
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 79.58. 50 day moving average is at 78.64.200 day moving average is at 76.23. Daily MACD is in sell zone. Important supports are at 79.10/78.85 and important resistance is at 79.70. Spot closed below its average level of the day.
Intraday supports and resistances for Aug contract are:
PP: 79.54, S1:79.28, S2:79.10, R1:79.72, R2:79.98.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USDINR Exports can be hedged near 79.70 levels. Nearby imports can be hedged at 79.10/78.85.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below major moving averages. Major resistance is at 1.0270/1.0450. Next major support is at 0.9935. Daily MACD is in buy zone, implying an important bottom at 0.9935. 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 buy zone, implying important bottom at 1.1750 and weekly MACD is in sell zone, implying important top at 1.3730. Important support is at 1.2040/1.1890. Important resistance is at 1.2245/1.2450.
USD/YEN: The pair is below 50 moving average, but above 200 day moving average. Daily MACD is in sell zone, implying important top at 139.40. Important support is at 131.50/130. Major resistance is at 139.40 with intermediate resistances at 135.50/137.50.
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