ICICIdirect.com's research report on currency
Forex (USD/INR)The rupee weakened on Monday, tracking offshore rates and as monthend dollar demand from importers dragged the currency lower, prompting the central bank to step up its dollar sales in late trade, pulling it off session’s lows. Sustained foreign selling in equities also continued to raise concerns about the gaping current account deficitThe rupee ended the day at 64.30, down 1.70 percent from the previous session’s close of 63.20The dollar index against six major currencies was at 81.38, up 0.10 percent from its previous closeUSD/INR derivatives strategy: Buy August contractIn the currency futures market, the most traded dollar-rupee August contract on the NSE closed at 64.46. The August contract open interest was down 11.90 percent from the previous dayThe September contract open interest was up 11.10 percent from the previous dayWe expect the US dollar to garner buying support on declines against the INR. Utilise the lows in the USD/INR August contract to buy.Intra-day strategy| USD/ INR August futures contract (NSE) | View: Bullish on USD |
| Buy USDINR in the range of 64.24-64.28 | Market Lot: USD1000 |
| Target: 64.46/64.55 | Stop Loss: 64.15 |
| Support: S1/ S2: 64.25/63.90 | Resistance: R1/R2:65.05/65.30 |
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