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Daily Snapshot

* The rupee managed to gain another 16 paise as it appreciated against the US dollar in the previous session due to positive domestic equities

* The dollar posted modest gains as the euro fell against the dollar post inflation data. However, gains in the dollar were limited due to weaker than expected US economic data, which pressured 10 years notes.

* On Thursday, the Nifty reversed its previous day’s selling pressure and closed with a gain of more than 1.15%. Sectorally, all the indices closed in positive. Looking at options data, we expect Nifty to face resistance around 16000 level as healthy Call writing is observed at the that strike

* The Bank Nifty opened on a positive note but faced resistance from 35000 Call writer and reversed from those levels. In the banking space, PSU banks outperformed private banks. According to option data, 35000 Call option hold significant OI which should act as immediate hurdle and resistance zone.

* Foreign institutional investors (FII) turned net sellers to the tune of | 3385 crore on July 20. They sold worth | 2782 crore in the equity market and worth | 602 crore in the debt market

Rupee Outlook and Strategy

* The US$INR is facing hurdle near its Call base of 75 and twice has reverted in this series. Looking at the option activity, we feel the rupee would remain in a range

* The dollar-rupee July contract on the NSE was at | 74.52 in the last session. The open interest fell almost 7.3% for the July series

US$INR Strategy

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