ICICI Direct expects US dollar to meet supply pressure at higher levels. Utilise up sides in the pair to go short on the USDINR pair.
ICICI Direct's currency report on USDINR
Government bonds ended higher for a second day, after record - low retail inflation in June increased expectations of an interest rate cut in the August monetary policy review meeting • The GoI benchmark 6.79 % 2027 bond yield was steady at 6. 4 6 % from the previous session • Yield on the US 10 - year rose to 2.3 4 % from 2.3 2 % in the previous session.Forex (US$/INR)
The rupee rose to a more - than - three - week high against the US$, after the US Federal Reserve Chair Janet Yellen’s comments signalleda gradual pace of rate increase while domestic June retail inflation fell to 1.54% • The US$ traded on a mixed note against major currencies ahead of US June CPI data and central bank meeting lined up next week. Dollar remain under pressure post US Fed chief Janet Yellen’s two - day testimony. Fed’s concerns on inflation growth raised the risk for US interest rate hike outlook.Strategy
In the currency futures market, the most traded dollar - rupee July contract on the NSE ended at 64.55. The July contract open interest increased 2.92 % from the previous day • August contract open interest increased 26.66 % in the previous session • We expect the US dollar to meet supply pressure at higher levels. Utilise up sides in the pair to go short on the US$INR pair.
|US$INR July futures contract (NSE)||View: Bearish on US$INR|
|Sell US$INR in the range of 64.53 - 64.63||Market Lot: US$1000|
|Target: 64.30 / 64.20||Stop Loss: 64.73|
S1/ S2: 64.40 / 64.30
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