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Last Updated : Aug 05, 2019 01:00 PM IST | Source: Moneycontrol.com

Buy USDINR; target of 70.60 - 70.70: ICICI Direct

ICICI Direct expects USDINR to find support at lower levels. Utilise downsides in the pair to initiate long positions.

Representative image
Representative image

ICICI Direct's currency report on USDINR

Spot Currency

The rupee extended sharp losses on Friday tracking losses in the Chinese Yuan as most EM currencies are hit by worsening risk sentiments. The rupee is likely to open further sharply lower today on huge losses in Chinese Yuan hit by a worsening trade war • The US dollar extended some losses against major currencies amid a sharp rally in the JPY and some recovery in Euro and GBP. Recent escalation in US-China trade war is likely to increase the probability of further rate cuts by the Fed. Chinese Yuan is currently trading at 7.03, its lowest level since April 2008. It is likely to see some more losses, which will weigh on EM currencies

Benchmark yield

Sovereign bond yields fell to 6.35% tracking a sharp cool-off in US yields as the US President re-escalated US-China trade war worries. Yields may decline further today amid a cool-off in domestic as well as US yields • US 10-year yields fell further to 1.85% and is currently trading at 1.77%, the lowest since November 2016. Yields are on a downward spiral tracking increased concerns as the US President continued to target Chinese imports into the US.

Currency futures on NSE

The dollar-rupee August contract on the NSE was at 69.71 in the previous session. Open interest increased 16.68% in the previous session • We expect the US$INR to find support at lower levels. Utilise downsides in the pair to initiate long positions.

Intra-day strategy 

US$INR August futures contract (NSE)View: Bullish on US$INR
Buy US$ in the range of 70.20 -70.30Market Lot: US$1000
Target: 70.60 / 70.70Stop Loss: 70.08
SupportResistance
S1/ S2: 70.20 / 70.00R1/R2:70.50 / 70.70
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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First Published on Aug 5, 2019 10:27 am
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