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Daily Snapshot

* After a sharp fall of 55 paise, the rupee managed to recover some loss and ended 25 paise higher. The rupee closed at 73.62 levels in the last session

* The dollar extended Monday’s gain and moved to new three-months high on continued liquidity demand in stocks. GBP/US$ on Tuesday tumbled to a five and a half month low on dovish comments from BoE policymakers.

* On Tuesday, the Nifty opened lower and ended at the lowest point in the past six weeks as it closed with a loss of more than 0.75%. Sectorally, except FMCG, all other indices closed with losses. According to options data, the Nifty is likely to face a hurdle at 15800 as substantial Call writing was seen

* The Bank Nifty continued to face selling pressure for a third consecutive day as it closed with a loss of more than 1.89%. Looking at options data, Put unwinding was seen across multiple strikes while substantial Call OI was seen at 34500 and 35000 strike

* Foreign institutional investors (FII) turned net sellers to the tune of | 2378 crore on July 19. They sold worth | 2279 crore in the equity market and worth | 99 crore in the debt market.

Rupee Outlook and Strategy

* The US$INR has again reverted from its highest Call base of 75. We feel only a sustainable close above this level would open up more upsides. Until then, it is likely to remain in a range

* The dollar-rupee July contract on the NSE was at | 74.71 in the last session. The open interest fell almost 8.7% for the July series

US$INR Strategy

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