Rupee to Decline on Stronger Greenback - HDFC Securities
* Most of the Asian currencies traded mixed earlier today but Indian rupee, Indonesian rupiah and Korean won in Offshore market traded lower on stronger greenback. However, lower crude prices and central bank intervention could support the rupee. We expected rupee could open around 18 paise lower from yesterday’s 5pm level.
* Technical setup suggests spot USDINR is having support at 74.50 followed by 74.30 while continue to resist around 75.50.
* All eyes on the Industrial activity data and forex reserves, scheduled later today. The reserves data will give central banks intervention stance, while IIP data provides how the re-opening of economy turned out for growth recovery. Indian sovereign bonds consolidate, with focus shifted to central bank measures to ease the burden of record debt sales.
* The 10- year bond yield rises 1bp to 5.79%, paring its decline this week to 6bps.The surplus liquidity in the financial system has been supporting demand. The dollar climbed from a four-week low Thursday, as a decline in U.S. stocks enhanced the currency’s safe-haven appeal.
* The dollar rally coincided with the Supreme Court ruling on Thursday that a New York prosecutor can obtain Trump’s financial records. Asian stocks were on course to follow their U.S. peers with modest declines amid concern that a resurgence in coronavirus cases could slow the global economic recovery. Oil dipped below $40 a barrel and Treasuries jumped.
USDINR JULY FUT. DAILY CHARTS
USDINR July Futures :
* USDINR July futures forming higher highs and lows on hourly chart.
* Momentum oscillators and indicators on hourly chart heading towards overbought zone suggesting continuation of up move.
* The pair is trading above supertrend line suggesting support at 75.
* The pair is having resistance at 75.45 and support at 74.98.
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