ICICI Direct expects USDINR to meet supply pressure at higher levels. Utilise upsides in the pair to initiate short positions.
ICICI Direct's currency report on USDINRSpot Currency
The rupee ended on a higher note, recovering the opening losses as decline in crude oil prices coupled with sliding domestic yields supported rupee • The US $ witnessed profit booking as risk - on mode staged recovery, even as major currencies managed to hold on to supports . British Pound jumped sharply post BoE monetary policy meeting as increase in hawks raised interest rate hike expectations. Euro rose from its supports near 1. 15 zone. We expect mild relief to emerging market currencies if US $ sees further declines.Benchmark yield
Sovereign bonds continue to rally as RBI’s bond buying as well as decline in crude oil prices is supporting domestic debt • US 10 - year yields declined to 2 . 90 % tracking weak crude oil prices as well as friction between US and global trading partners. However headwinds remain even as traders await further details of 10 % tariff on $ 200 bn of Chinese imports into US as well as plans of investment restrictions on China by the US.Currency futures on NSENear - month dollar - rupee June contract on the NSE was at 68. 04 in the previous session. June contract open interest declined 2. 67 % in the previous day • We expect the US$INR to meet supply pressure at higher levels. Utilise upsides in the pair to initiate short positions.
|US$INR June futures contract (NSE)||View: Bearish on US$INR|
|Sell US$INR in the range of 67.98 - 68.04||Market Lot: US$1000|
|Target: 67.75 / 67.70||Stop Loss: 68.16|
|S1/ S2: 67.85 / 67.60||R1/R2:68.10 /68.20|