ICICI Direct expects USDINR to find supports at lower levels. Utilise downsides in the pair to initiate long positions..
ICICI Direct's currency report on USDINR
The rupee pared some of its previous session’s gains to end lower at 70.91, losing almost 16-paise against US$. Today it is expected to open slightly lower tracking strength in US$ • The dollar extended gains with the Euro and British Pound continuing to witness profit booking from its previous rallies. Expectations that US-China may inch towards a trade deal are supporting US$ and yields. Market participants would be awaiting clarity on Brexit, which could further improve global risk sentiment.
Sovereign treasury declined to 7.38% as muted global yields and lower inflation have kept yields in a range. Domestic retail inflation fell to 2.05% in January 2019, which could provide further space for RBI to cut rates • US treasury yields declined to 2.72% while worsening global growth expectations could cap sharply rising yields. Incoming economic data remains important for further signals.
Currency futures on NSE
The dollar-rupee March contract on the NSE was at 71.13 in the previous session. March contract open interest declined 5.08% in the previous session • We expect the US$INR to find supports at lower levels. Utilise downsides in the pair to initiate long positions.
|US$INR March futures contract (NSE)||View: Bullish US$INR|
|Buy US$ in the range of 71.08 -71.14||Market Lot: US$1000|
|Target: 71.35 / 71.45||Stop Loss: 70.95|
|S1/ S2: 71.12 / 71.02||R1/R2:71.35 /71.45|
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