ICICI Direct expects US$ to find supports at lower levels. Utilise downsides in the pair to go long on the US$INR pair.
ICICI Direct's currency report on USDINR
Government bonds ended little changed in lacklustre trade, as investors deferred purchases ahead of a weekly debt auction. Also, political turmoil in the US could support bonds as yields remain on the backfoot • The benchmark 6.97% 2026 bond yield was almost unchanged at 6.68% in the previous session • Yield on the US 10-year rose mildly to 2.23% from 2.22% in the previous session.Forex (US$/INR)
The rupee marked its biggest single-day fall in nearly 21 months against US$, as political unrest in the US involving President Donald Trump dented investors’ appetite for risk assets • The US$ recovered slightly against major currencies due to profit booking and recovery in yields. Even though US$ weakened against majors, it strengthened against most emerging currencies as recent political turmoil in the US has weighed on risk-on sentiment. We expect the US$ index to find supports above 96.50 level in the near term.US$/INR derivatives strategy
In the currency futures market, the most traded dollar-rupee May contract on the NSE ended at 64.93. The May contract open interest declined 14.42% from the previous day • June contract open interest increased by 5.19% in the last session • We expect the US$ to find supports at lower levels. Utilise downsides in the pair to go long on the US$INR pair.
|US$INR May futures contract (NSE)||View: Bullish on US$INR|
|Buy US$INR in the range of 64.60 - 64.70||Market Lot: US$1000|
|Target: 65.05 / 65.10||Stop Loss: 64.50|
|S1/ S2: 64.60 / 64.40||R1/R2:64.90 /65.10|
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