ICICI Direct expects USD to find supports at lower levels. Utilise the down side in the pair to go long on the USDINR.
ICICI Direct's currency report on USDINRDebt market
Government bonds fell today as market sentiment remained bearish amid oversupply of notes in this fiscal year and ensuing concerns over the Centre’s fiscal consolidation drive • The GoI benchmark 6. 79 % 2027 bond yield rose to 7. 34 % from 7. 29 % in the previous session • Yield on the US 10 - year benchmark bond was steady at 2.48 % in the previous session.Forex (US$/INR)
The rupee fell for the first time in three sessions, as a recovery in the US$ amid Euro weakness outweighed gains triggered by a weaker - than - expected US jobs data • US$ fell against major currencies as euro and other major currencies reversed previous gains. Yen, however, remained in a range while strength in the JPY could trigger risk aversion. US$ is rising on the back of tightening yields and gains in equities. We expect the US$ to further gain, which could pressurise emerging currencies including rupee.Strategy In the currency futures market, the near month dollar - rupee January contract on the NSE was at 63. 64. The January contract open interest declined 3.99 % from the previous day • February contract US$INR ended at 63.83. Open interest increased 5.27 % in the previous session • We expect the US$ to find supports at lower levels. Utilise the down side in the pair to go long on the US$INR.
|US$INR January futures contract (NSE)||View: Bullish on US$INR|
|Buy US$INR in the range of 63.60 - 63.65||Market Lot: US$1000|
|Target: 63.75 / 63.85||Stop Loss: 63.48|
|S1/ S2: 63.55 / 63.45||R1/R2:63.75 /63.85|