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Last Updated : Feb 09, 2017 10:46 AM IST | Source:

Sell USDINR; target of 67.10 - 67.00: ICICI Direct

ICICI Direct expects US dollar to meet supply pressure at higher levels. Utilise upsides in the dollar to go short on the USDINR pair. Sell February Futures with a target of 67.10 - 67.00.

ICICI Direct's report on currency

Debt market  
Government bonds plunged, with the benchmark yield posting its biggest single-session gain since September 2013, after the country’s Monetary Policy Committee unexpectedly left key interest rate unchanged and shifted to a ‘neutral’ stance • The benchmark 6.97% 2026 bond yield rose sharply to 6.74% from 6.43% as the central bank kept key policy rates unchanged against the major market concensus of a rate cut • Yield on the US 10-year fell to 2.34% from 2.39% in the previous day.  

Forex (US$/INR)  
The rupee rose to a near-three-month- high against the US$, outweighing  an initial impact from the Monetary Policy Committee’s decision to keep  interest rates unchanged, against major market consensus of 25 bps cut  • The US$ remained steady against major currencies ahead of US  President and Japane Prime minister ’s scheduled meet. Political and trade policy uncertainty created by the US President’s executive orders and statements overlooked the rate hike sentiment weighing on.

US$ US$/INR derivatives strategy  
In the currency futures market, the most traded dollar-rupee February contract on the NSE ended at 67.34. The February contract open interest rose 1.65% from the previous day • March contract open interest rose 7.24% from previous day • We expect the US dollar to meet supply pressure at higher levels. Utilise upsides in the dollar to go short on the US$INR pair.   

Intra-day strategy
US$INR February futures contract (NSE)View: Bearish on US$INR
Sell US$INR in the range of 67.35 - 67.45Market Lot: US$1000
Target: 67.10 / 67.00Stop Loss: 67.55
S1/ S2: 67.25 / 67.05R1/R2:67.50 /67.70

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on are their own, and not that of the website or its management. advises users to check with certified experts before taking any investment decisions.

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First Published on Feb 9, 2017 10:46 am
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