USDINR opened at 81.67 y’day and the pair traded in the 81.45-81.69 range. Spot USDINR closed at 81.65, gain of 35 ps for USD as against prior close of 81.30. Rupee is declining as USD INDEX fall has stabilized after its recent downtrend.

RBI reference rate was fixed at 81.63 on 17/11. Nov USD/INR closed at 81.71, gain of 37 ps for USD as compared to prior day’s close of 81.34. Nov Euro/INR closed at 84.48, GBP/INR at 96.78 and Yen/INR at 58.40. USDINR fwd premia was trading at around 2.10% p.a.  FX reserves stands at USD 529.9 bn as on Nov 4th.  FX reserves declined by USD 1.09 bn as compared to previous fortnight.

In Nov, FII’S bought Rs 12062 Cr of Equities and sold Rs 756 Cr of debt till date. In this Calendar Year, FII’S have sold close to Rs 1.25 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 declined 65 points (0.36%) y’day. DOW closed flat y’day (0.%). Nikkei declined 0.35% and Hang Seng declined 1.15% y’day.

Euro is now at 1.0364, Pound at 1.1865, Yen at 140.27.

Commodities: Gold is now at USD 1762 and WT1Crude at USD 82/Brent at USD 90.

Interest rates: USD 10 Yr yield is at 3.77% and 3 m libor closed at 4.64%. Indian 10 yr benchmark yield closed at 7.28%.

Economic news: St. Louis Fed President James Bullard said, “even under these generous assumptions, the policy rate is not yet in a zone that may be considered sufficiently restrictive”. And, “to attain a sufficiently restrictive level, the policy rate will need to be increased further. “Thus far, the change in the monetary-policy stance appears to have had only limited effects on observed inflation, but market pricing suggests disinflation is expected in 2023,” Bullard said.

Eurozone CPI was finalized at 10.6% yoy in October, up from September’s 9.9% yoy.

Brent crude declined, weighed down by demand concerns and slow down in US manufacturing activity.

Data highlights: – US Weekly jobless claims dipped to 222k, Phily Fed mfrg index declined to -19.4, building permits was reported at 1.53 mn and housing starts climbed to 1.43 mn.

-EU CPI climbed 10.6% y/y.

Friday’s calendar : – US existing home sales

-UK 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 82.16. 50 day moving average is at 81.28.200 day moving average is at 78.07. Daily MACD is in sell zone. Important support is at 80.50 and important resistance is at 81.90. Spot closed above its average level of the day.

Intraday supports and resistances for Nov contract are:

PP: 81.63, S1:81.50, S2:81.31, R1:81.83, R2:81.95.             

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

However on directional basis, suggest the following:

Exports be hedged at 82+ levels. Imports be hedged at 80.75.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is above 50 and 20 day major moving averages. Major resistance is at 1.0470. Next major support is at 1.02/1.01. Daily MACD is in buy zone, implying an important bottom at 0.9535. Weekly MACD is in buy zone, implying important bottom at 0.9535.

GBP/USD: The pair is above 50 and 20 day moving averages. Daily MACD is in buy zone, implying important bottom at 1.1150 and weekly MACD is in buy zone, implying important bottom at 1.0380. Important support is at 1.1650. Important resistance is at 1.20.

USD/YEN: The pair is above 50 and 200 day moving averages. Daily MACD is in sell zone, implying important top at 152. Important support is at 135.50. Major resistance is at 140.40.

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