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Buy USDINR; target of 72.05 - 72.15: ICICI Direct

ICICI Direct expects USDINR to find support at lower levels. Utilise downsides in the pair to initiate long positions.
Nov 21, 2019 / 09:56 AM IST

ICICI Direct's currency report on USDINR

Spot Currency

The rupee depreciated by 10-paise vs. the US$, spooked by depreciation in the Chinese Yuan as well as domestic growth woes. It is likely to open slightly lower today and would remain under pressure owing to a rebound in oil price and a further weakening CNY • The US$ index ended mildly higher yesterday even as investors continue to gauge US-China on-again, off-again trade talks. Also, the US President, who is likely to sign a bill supporting Hong Kong protestors would further complicate US-China trade relations. CNY is currently trading at 7.04. Any further weakness in the same is likely to put pressure on EM currencies, including rupee.

Benchmark yield

Domestic benchmark 10-year yields ended unchanged at 6.46% in the previous session. Growing worries over domestic growth as well as hardening US yields could contain a sharp appreciation in domestic debt • US 10-year benchmark yields ended further lower at 1.74%. The US President’s fresh threat of higher tariffs on Chinese imports in case of a deal failure worsened risk sentiments.

Currency futures on NSE

The dollar-rupee November contract on the NSE was at 71.86 in the previous session. Open interest declined 1.84% 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$INR November futures contract (NSE)View: Bullish on US$INR
Buy US$ in the range of 71.78 -71.82Market Lot: US$1000
Target: 72.05 / 72.15Stop Loss: 71.63
S1/ S2: 71.75 / 71.55R1/R2:72.0 / 72.15
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.

first published: Nov 21, 2019 09:56 am

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