ICICI Direct expects US dollar to meet supply pressure at higher levels. Utilise upsides in the pair to go short on the US$INR.
ICICI Direct's currency report on USDINR
Government bonds ended lower for a third session as investor sentiment remained muted amid absence of fresh triggers ahead of fiscal year end • The benchmark 6.97% 2026 bond yield rose mildly to 6.89% from 6.86% supported by an uptick in domestic inflation • Yield on US 10-year further fell to 2. 46% from 2.50% in the previous dayForex (US$/INR)
The rupee rose to a fresh near-17-mont h high against the dollar, in line with most Asian currencies as the US $ stayed under pressure after the US Fed maintained its stance of a gradual pace of rate hikes in 2017 • The US dollar posted minor gains against major currencies in otherwise calm forex markets. We expect the US$ to remain under pressure and in consolidation as major dollar positive sentiment is already priced in. The pound fell as the UK has conveyed to Europe on triggering Article 50, setting the stage for two years of negotiation for separation from EUUS$/INR derivatives strategy
In the currency futures market, the most traded dollar-rupee March contract on the NSE ended at 65.44. The March contract open interest fell 1.80% from the previous day • April contract open interest rose 6.99% from the previous day • We expect the US dollar to meet supply pressure at higher levels. Utilise upsides in the pair to go short on the US$INR pair.
|US$INR March futures contract (NSE)||View: Bearish on US$INR|
|Sell US$INR in the range of 65.50 - 65.60||Market Lot: US$1000|
|Target: 65.40 / 65.30||Stop Loss: 65.70|
|S1/ S2: 65.40 / 65.30||R1/R2:65.70 /65.80|
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