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The Indian rupee is expected to open slightly lower following an overnight strength in the dollar index. The implied opening from the forward market suggests USDINR opening around 81.59. On Monday, spot USDINR closed on a flat note as it closes at 81.50, down 2 paise.

Spot USDINR is oscillating around a short-term moving average of 10 days. The pair has resistance at 81.90 and support at 81.10. After a higher opening, we could see range-bound trade with a thin volume ahead of the Union Budget announcement.

Today’s focus will be on eight core infra, economic survey and fiscal deficit numbers.

Traders in Asia are also focused on developments surrounding India’s Adani Group. Abu Dhabi’s International Holding Co. has agreed to invest about $400 million in Adani Enterprises Ltd.’sfollow-on share sale.

The dollar gained as traders switched to a risk-off mode at the start of a week that includes the Federal Reserve’s interest-rate decision as well as the European Central Bank gathering. The euro reverted to losses after advancing earlier on hotter-thanexpected inflation data spiking bets for the ECB rate hikes. The euro fell to 1.0845 afterit spiked to 1.0914, approaching a new cycle high at 1.0929.

A gauge of global stocks held to a monthly gain of more than 6% amid mixed trading in Asia on Tuesday as investors positioned for interest-rate hikes this week from the Federal Reserve and the European Central Bank.

Elsewhere in markets, oil steadied afterslipping to a three-week low on Monday.

The International Monetary Fund (IMF) raised its global economic growth outlook for the first time in a year, with resilient US spending and China’s reopening buttressing demand against a litany of risks. Gross domestic product will likely expand 2.9% in 2023, 0.2% more than forecast in October, the fund said Tuesday in a quarterly update to its World Economic Outlook.

USDINR

Technical Observations:

USDINR February future closed above 10 days exponential moving average.

he pair has support at 80.90, the recent swing bottom, and resistance at 81.94, the 20-day simple moving average.

The first sign of bullishness has been seen on an hourly chart with a higher high formation.

Momentum oscillator, Relative Strength Index is placed below 50 and flattened indicating consolidation.

MACD has given a positive crossover to the MACD average indicating a positive trend.

The derivative data shows a minor short build-up as the price declines while open interest rises.

USDINR February fut. is expected to trade between 81.30 to 81.94 before heading north.

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