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Rupee To Open Higher As Institution Turns Buyer -  HDFC Securities 

Indian rupee expected to open slightly higher as risk assets rebound supported by foreign and domestic institutional buying. Strength in major currencies against US dollar and higher global equities could support rupee in last trading session of the week as domestic forex markets will remain close on Friday on account of Holi Festival.

On Wednesday, spot USDINR fell 35 paise to 76.27 taking cues from regional currencies. The pair has started forming lower highs and lows on hourly chart indicating near term weakness. For the day, it has support at 76 and resistance at 76.40

The FOMC decision is out and the consensus view of a 25 basis-point hike has been confirmed. The action, though, is in the dot plot where the median dot ends 2022 at 1.9% and 2023 at 2.8%. US Treasuries were relatively slow to react, but they’ve seen the dot plots now and the curve is shifting higher, especially around the belly.

A gauge of the dollar’s strength fell after Federal Reserve Chair Jerome Powell struck a more positive tone on the prospects for economic growth amid policy tightening. Safe haven currencies and commodities declined after China’s more market-friendly policy stance unveiled a day ago, and possible progress on cease-fire talks between Russia and Ukraine, are aiding risk sentiment.

Asia-Pacific equities rose more than 2% as the tech gains propelled Hong Kong and a weaker yen spurred export-reliant Japan. S&P 500 and Nasdaq 100 futures fluctuated after the broad U.S. market’s best two-day gain since 202

USDINR

Technical Observations:

USDINR March futures closed below low of Doji candlestick pattern indicating bearishness.

The pair has also started forming lower top lower bottom on hourly chart, indicating near term weakness in the trend. However, on daily chart it is still in bullish formation.

The pair is having support at 76.06, the 21 days exponential moving averages.

Relative Strength Index of 14 days period placed at 56 and heading south indicating bearish momentum.

Derivative price actions indicated continuation of long unwinding with fall in price and open interest.

USDINR March futures remain under pressure with downside support around 76 and resistance at 76.40.

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