USDINR opened at 82.30 y’day and the pair traded in the 82.30-83.02 range. Spot USDINR closed at 83.02, gain of 66 ps for USD as against prior close of 82.36.

RBI reference rate was fixed at 82.37 on 19/10. Oct USD/INR closed at 83.14, gain of 69 ps for USD as compared to prior day’s close of 82.44. Oct Euro/INR closed at 81.29, GBP/INR at 93.45 and Yen/INR at 55.68. USDINR fwd premia was trading at around 2.50% p.a.  FX reserves stands at USD 532.87 bn as on Oct 14 th.

In Oct, FII’S have sold Rs 9135 Cr of Equities and have bought Rs 481 Cr of debt till date. In this Calendar Year, FII’S have sold close to Rs 1.55 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 25 points (0.14%) y’day. DOW declined 100 points (-0.33%). Nikkei climbed 0.37% and Hang Seng declined 2.38%.

Euro is now at 0.9759, Pound at 1.1202, Yen at 149.90.

Commodities: Gold is now at USD 1629 and WT1Crude at USD 84.65/Brent at USD 92.25.

Interest rates: USD 10 Yr yield is at 4.15% and 3 m libor closed at 4.19%. Indian 10 yr benchmark yield closed at 7.45%.

Economic news: Rupee declined steeply breaking 82.67 top. Rising US Yields is contributing to USD’S rise against majors. Stop loss orders at 82.67 also triggered steep fall. RBI’S absence at 82.40 and PSU banks bid for USD 1 bn also drove Rupee lower. Rupee is under strain due to expanding CAD and higher US Yield.UK and EU inflation data also prompted traders to think that more aggressive rate hikes are in the offing.

U.S. President Joe Biden announced the sale of 15 million barrels from the country’s Strategic Petroleum Reserve (SPR) and threatened more such sales to bring down gasoline prices. However, draw down in Crude inventory offset US plans. US Oil consumption remains steady and robust. Crude hovers around USD 90-92, despite SPR release.

Data highlights: – US building permits climbed to 1.56 mn and housing starts dipped to 1.44 mn.

-EU CPI climbed 9.9% y/y.

-UK CPI climbed 10.1% y/y, RPI rose 12.6% y/y and PPI(output) climbed 0.2% m/m.

Thursday’s calendar : – US existing home sales and weekly jobless claims.

 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 81.85. 50 day moving average is at 80.55.200 day moving average is at 77.56. Daily MACD is in sell zone. Important support is at 82.67/82.03 and important resistance is at 83.35. Spot closed above its average level of the day.

Intraday supports and resistances for Oct contract are:

PP: 82.88, S1:82.58, S2:82.05, R1:83.42, R2:83.71.             

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

However on directional basis, suggest the following:

USDINR imports be hedged at 82.65.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below major moving averages. Major resistance is at 1.00. Next major support is at 0.9540. Daily MACD is in sell zone, implying an important top at 1.02. 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 1.0380 and weekly MACD is in sell zone, implying important top at 1.3730. Important support is at 1.0380. Important resistance is at 1.1490/1.18.

USD/YEN: The pair is above 50 and 200 day moving averages. Daily MACD is in buy zone, implying important bottom at 140.40. Important support is at 145.90/140.40. Major resistance is at 151.

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