ICICIdirect.com has expect the US dollar to find buying support on decline against the rupee. Utilise declines in the US$/INR September contract to Buy target of 67.65 - 67.85.
• Government bonds erased earlier lo sses to end higher, after a senior finance ministry official said the government may issue a new 10-year note this week as current issuance has reached its limit • The benchmark 7.59% bond maturing in 2026 ended at | 103.15 against the previous close of | 103.11 • The benchmark 7.59% 2026 bond yield remained unchanged at 7.12%
• The rupee fell to a one-week low against the dollar, as the Federal Reserve Chair’s comments about the strength in the US economy sparked speculation of an interest rate hike this year coupled with month end dollar demand weighing on the rupee • The dollar index against six major cu rrencies ended slightly unchanged in yesterday’s trade at 95.58 sustaini ng gains on rate hike prospects
US$/INR derivatives strategy : Buy September Contract
• In the currency futures market, the most traded dollar-rupee September contract on the NSE ended at 67.49. The September contract open interest rose 32.68% from the previous day • October contract open interest was up 51.89% from the previous day • We expect the US dollar to gain supports at lower levels. Utilise downsides in US dollar to go long in US$INR September futures.
|US$INR September futures contract (NSE)||View: Bullish on US$INR|
|Buy US$INR in the range of 67.25-67.35||Market Lot: US $1000|
|Target: 67.65 - 67.85||Stop Loss: 67.10|
|S 1/ S2: 67.30/67.10||R 1/R 2:67.60/67.80|
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