Moneycontrol
Aug 10, 2017 10:47 AM IST | Source: Moneycontrol.com

Sell USDINR; target of 63.85 - 63.75: ICICI Direct

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


ICICI Direct's currency report on USDINR


Debt market

Government bonds fell as a rise in domestic yields on the back of geo - political risk escalation along with expectations of a rise in domestic inflation weighed on debt • The GoI benchmark 6.79 % 2027 bond yield rose to 6. 47% in the previous session • Yield on the US 10 - year fell to 2.2 5 % from 2. 26 % in the previous session.

Forex (US$/INR)

The rupee  weakened sharply against US$ on the  back of profit booking  in  domestic equities  along with escalation in geo - political risk weighing  on  emerging currencies, including rupee • US$  fell against major currencies as gains over Euro were weighed by  losses against Japanese Yen and British Pound.  Rise in geo - political risks led to a spike in Japanese Yen, which could see short closure in Japanese Yen.  Forex markets remain on the edge amid geo - political risks and US political concerns around the President.

Strategy
In the currency futures market, the most traded dollar - rupee August contract on the NSE ended at 63.99. The August contract open interest  declined 7.70 % from the previous day • September contract open interest  increased 1.57 % in the  previous session • We expect the US$ to meet supply pressure at higher levels. Utilise up sides to go short on the US$INR pair.

Intra-day strategy

US$INR August futures contract (NSE)View: Bearish on US$INR
Sell US$INR in the range of 64.00-64.10Market Lot: US$1000
Target: 63.85 / 63.75Stop Loss: 64.20
SupportResistance
S1/ S2: 63.90 / 63.80R1/R2:64.00 /64.20

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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