Expect rupee to trade in 63.00-62.60 range: Karvy
Karvy Stock Broking has come out with its report on currency. For the day expect the USDINR pair to trade in a range of 63.00-62.60 levels, says the research firm.
December 04, 2013 / 12:55 IST
Karvy's research report on currency -
The US equities fell for the third consecutive day on Tuesday, taking cues from the same the Asian stock markets are trading deeply in the red today. The negative trading of Japanese stocks also led to a weakness in the Asian equities backed by a strengthening yen. Likewise, SGX Nifty future is down by 21 points. This may weigh down on the domestic indices (Sensex and Nifty) during opening and could also influence the rupee to open on a negative note .While the euro is trading on a stronger note, taking cues from the ECB policy meeting due tomorrow in which it is speculated that the European Central Bank officials may refrain from cutting the benchmark interest rate. This could limit the losses in the rupee. As the day progresses, the rupee may further recoup its losses on the anticipation of improving India’s PMI services number. The string of economic releases from the Europe may support further gains in the shared currency euro. The major economic data which the market would watch could be Europe’s third quarter GDP growth rate. The Dollar index may limit its losses during the day on the anticipation of better ADP number from the US in the evening. Other economic releases from the US may remain at the blend. Overall we expect the rupee to trade on the marginally weaker note for the day.JPYINR: The Japanese yen strengthened around half a percent against the dollar yesterday and it maintained the similar trend in the today morning hours. The yen which is trading against the rupee may take cues from the same. Going ahead, the rupee may further recoup its losses on the anticipation of improving India’s PMI services number. The economic releases from the US may limit the losses in the Dollar index during the day which could pressurize the yen against the rupee. Overall we expect the rupee to trade on a marginally weaker note against the dollar.EURINR: Yesterday euro gained the most against the dollar and settled at 1.3588 while today morning it is trading at 1.3592 against the dollar. This may support the euro which is trading against the rupee. The slew of economic releases from the Europe may support further gains in the shared currency euro. The market would watch for Europe’s third quarter GDP growth rate which is expected to improve at a slower pace. The Dollar index may limit its losses during the day on the anticipation of better ADP number from the US in the evening. Overall we expect the rupee to trade on a negative note against the euro.GBPINR: The pound has also advanced against the dollar yesterday while it traded on a flat note at 1.6389. This may support the pound which is trading against the rupee. As the day progresses, India will release its PMI service which is likely to improve and may restrict the losses in the rupee. However, the weak economic data expectation from the UK in the form of official reserves may limit the pound gains. Overall we expect the rupee to trade on a flat to marginally weaker note against the pound.TECHNICAL OUTLOOK –
The Dollar-rupee December futures contract closed higher on Tuesday at 62.71, a gain of 0.15 percent over the prior day. Earlier it opened gap-up and tested a high of 62.82 .Thereafter it traded in a narrow range of 62.57-62.75 level. From a daily chart perspective the candlestick pattern depicts a harami cross formation suggesting that the prevailing downtrend could be slowing down however there is still no indication of an uptrend as prices have consistently traded below the major short term moving averages on the daily charts,mainly the 5,8 and 13 ema’s which are clustered in the range of 62.80-63.00.The middle end of the Bollinger band which is at the 62.97 levels could also prove to be a resistance for the pair .Hence any pullback to those levels should be treated with caution for long positions as we could expect profit booking to set at higher levels.Overall we could expect the USDINR pair to trade in a range of 63.00-62.60 levels for the day.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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