Moneycontrol
Oct 19, 2016 10:26 AM IST IST | Source: Moneycontrol.com

Sell US$INR October Fut; target of 66.80 - 66.60: ICICIdirect

ICICIdirect.com has expect the US dollar to find buying support on decline against the rupee. Utilise declines in the US$/INR October contract to Sell target of 66.80 - 66.60.


ICICIdirect.com's report on currency

Currency

Debt market  

• Government bonds ended higher, with the benchmark note hitting an  over one-week high, on expectations that the central bank may hold  another round of open market purchase of debt.  • The benchmark 6.97% bond maturing in 2026 ended at | 101.79 against  the previous close of | 101.60  • The benchmark 6.97% 2026 bond yield fell to 6.72% from 6.75% on  Monday.  

Forex (US$/INR)  

• The rupee gained against the US$ on  a strong rally in domestic equities.  Market expectation of another rate cut on lower inflation also continues  to support the rupee on any weakness  • The dollar index remained almost unchanged with its gauge against  major currencies facing headwinds near 98 level. US September core  CPI data was lower at 2.2% vs. 2.3% in August weighing on a recent  surge in the US dollar.  

US$/INR derivatives strategy: Sell October Contract  

• In the currency futures market, the  most traded dollar-rupee October  contract on the NSE ended at 66.79.  The October contract open interest  rose 9.08% from the previous day  • November contract open interest rose 5.49% from the previous day  • We expect the US dollar to meet supply pressure at higher levels. Utilise  upsides in the dollar to go short on the US$INR pair.  

Intra-day strategy



US$INR October futures contract (NSE )View: Bearish on US$INR
Sell US$INR in the range of 66.95 - 67.05Market Lot: US$1000
Target: 66.80 - 66.60Stop Loss: 67.15
SupportResistance
S 1/ S2: 66.80/66.60R 1/R 2:66.95/67.15








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