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Jan 12, 2018 10:59 AM IST | Source: Moneycontrol.com

Sell USDINR; target of 63.58 - 63.50: ICICI Direct

ICICI Direct expects USD to meet supply pressure at higher levels. Utilise the up side in the pair to go short on the USDINR.

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ICICI Direct's currency report on USDINR


Debt market

Government bonds were little changed as sentiment s turned bearish  amid higher oil prices and lowered expectations on rate cut s in  the  near  future • The GoI  benchmark  7.17 % , 2028 bond  yield rem ained unchanged 7.26 % in the previous session • Yield on  the  US 10 - year benchmark bond declined to 2.53 % from 2. 5 6 % in the previous session.

Forex (US$/INR)

The rupee fell against the US$, as higher oil prices and overnight strength in the US$ weighed on emerging currencies including the rupee. However , with the announcement of FDI reforms , we expect  the  rupee to see  some strength from current levels • The US$ declined against major currencies as strength in  the  Euro and  JPY weighed on  the  US$. The dollar fell a long with US yields that continue to face hurdle near the 2.60 % zone. The euro gained post ECB minutes although 1.21 continues to be a crucial hurdle. A breach of this level could see the pair rising till 1.23 levels.

Strategy
In the currency futures market, the near month dollar - rupee January contract on the NSE was at 63.77. The January contract open interest declined 4.92 % from the previous day • February contract US$INR ended at 63.98. Open interest increased 2.97 % in the previous session • We expect the US$ to meet supply pressure at higher levels. Utilise the up side in the pair to go short on the US$INR.

Intra-day strategy

US$INR January futures contract (NSE)View: Bearish on US$INR
Sell US$INR in the range of 63.75 - 63.81Market Lot: US$1000
Target: 63.58 / 63.50Stop Loss: 63.92
SupportResistance
S1/ S2: 63.65 / 63.50R1/R2:63.80 /63.90

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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