FX – MORNING UPDATE :
USDINR opened at 82.37 y’day and the pair traded in the 82.36-82.55 range. Spot USDINR closed at 82.51, gain of 29 ps for USD as against prior close of 82.22.
RBI reference rate was fixed at 82.45 on 06/07. July USD/INR closed at 82.51, gain of 17 ps for USD as compared to prior day’s close of 82.34. July Euro/INR closed at 89.92, GBP/INR at 105.28 and Yen/INR at 57.63. 1 year USDINR fwd premia was trading at around 1.62% p.a. FX reserves declined USD 3 bn last week as compared to prior week and stood at USD 593 bn as on June23 rd.
| PAIRS | RBI REF RATE (06/07) |
| USDINR | 82.45 |
| EURINR | 89.59 |
| GBPINR | 104.84 |
| JPYINR | 57.34 |
In June ,FII’S have bought Rs 75450 Cr of Equities and sold Rs 2650 Cr of debt . In 2022-23 fiscal year, FII’S have net sold Rs 27593 Cr of Equities and have net bought Rs 838 Cr of debt.
Benchmark Nifty climbed 99 points (0.51%) y’day. US S&P declined 35 points (0.79%) . Nikkei declined 1.7% and Hang seng declined 3.17%.
Euro closed at 1.0889, Pound at 1.2738, Yen at 144.05.
Commodities: Gold is now at USD 1917 and WT1Crude at USD 72/Brent at USD 76.
Interest rates: USD 10 Yr yield is at 4.04% and 3 m libor closed at 5.55%. Indian 10 yr benchmark yield closed at 7.14%.
Economic news: Indian PMI(services) eased to 58.5 from May high of 61.2. PMI(mfrg) remained robust at 57.8. June GST collection grew 12% Y/Y to 1,61,497 CR.
Rupee declined on PSU banks buying of USD towards Govt external debt payment.
US ADP private employment grew 497k in June, well above expectation of 250k. As a consequence of strong data, US Yields pushed higher with 10 Year yield breaching 4%. Equity markets tumbled, but USD remained indecisive.
Focus is on US jobs data and earnings.
Data highlights: – US Weekly jobless claims eas reported at 248k, ISM (services) was stronger than expected at 53.1 and ADP employment report showed that private sector added 497 k jobs.
-German factory orders climbed 6.4% m/m. EU retail sales was flat m/m.
-UK PMI(construction) declined to 48.9.
Friday’s calendar : – US nonfarm payrolls
-German industrial production.
| USD/INR | 82.55 | 82.36 | ||
| EUR/USD | 1.0889 | 1.0901 | 1.0833 | |
| GBP/USD | 1.2738 | 1.2780 | 1.2674 | |
| USD/JPY | 144.05 | 144.66 | 143.56 |
Daily Support/Resistance table
| Currency Pairs | Pivot | R1 | R2 | R3 | S1 | S2 | S3 |
| EURO/USD | 1.0875 | 1.0917 | 1.0943 | 1.0985 | 1.0849 | 1.0807 | 1.0781 |
| GBP/USD | 1.2732 | 1.2790 | 1.2838 | 1.2896 | 1.2684 | 1.2626 | 1.2577 |
| USD/JPY | 144.07 | 144.58 | 145.17 | 145.68 | 143.48 | 142.97 | 142.37 |
| USD/INR | 82.47 | 82.58 | 82.66 | 82.39 | 82.28 |
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
| Currency Pair | Supports | Resistances | Trend | Remarks |
| EURO/USD | 1.0845/1.08 | 1.1010/1.1075 | UP | SIDE<1.0840 |
| GBP/USD | 1.2590 | 1.2850/1.2975 | UP | SIDE<1.2590 |
| USD/JPY | 142.25/141.25 | 145.50 | UP | SIDE<141.25 |
| USD/INR | 82.25/82.17/82.10 | 82.55/82.75 | UP | SIDE<82.17 |
| USD/CHF | 0.89/0.8820 | 0.9110 | DN | UP>0.9110 |
Technicals: Spot closed above 200 day moving average.20 day moving average is at 82.17. 50 day moving average is at 82.24.200 day moving average is at 82.15. Daily MACD is in buy zone. Important support is at 82.25/82.17 and important resistance is at 82.55/82.75. Spot closed above the average level of the day.
Intraday supports and resistances for July contract are:
PP: 82.48, S1:82.35, S2:82.20, R1:82.63, R2:82.76.
Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.
However on directional basis, suggest the following:
USD Exports be hedged on rally to 82.70+.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is above major moving averages. Major resistance is at 1.1075. Next major support is at 1.0840/1.08. Daily MACD is in sell zone, implying an important top at 1.1010. Weekly MACD is in sell zone, implying important top at 1.1095.
GBP/USD: The pair is above 50,100 and 200 day moving averages . Daily MACD is in sell zone, implying important top at 1.2850 and weekly MACD is in buy zone, implying important bottom at 1.1803. Important support is at 1.2590. Important resistance is at 1.2850/1.2975.
USD/YEN: The pair is above all major averages. Daily MACD is in buy zone, implying important bottom at 138.40. Important resistance is at 145.50 and support is at 142.25/141.25.
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