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Rupee : Sluggish starts following global cues

Indian Rupee expected to show muted start following Asian currencies which are mixed against dollar in the early Asian session amid a wait-and-see mood ahead of inflation data. The dollar depreciated against major currencies on Monday as markets weighed the prospects for tighter policy, with Treasury Secretary Janet Yellen saying that higher interest rates would be a “plus” for the U.S. and the Federal Reserve.

On Monday, spot USDINR closed at 72.81 declined 0.26% or 19 paise following stronger foreign fund inflows, higher equities and decline in virus cases. India’s economy is showing early signs of recovery as the second wave of virus infections recedes and the number of active cases fell for a fourth straight week row. An acceleration in global vaccination rates and re-opening of economy likely to support rupee in near term. Technically, spot USDINR is expected to trade with negative bias and we could see level of 72.60 in coming days while 73.30 remains strong supply area.

The dollar index weakened versus all of its Group-of-10 currency peers Monday, extending last week’s losses, as investors weighed the prospects of tapering from the Federal Reserve. Forex markets trader will eye on CPI figures due later this week, over the past two months have been higher-than-expected on the back of rising commodities prices and ongoing supply bottlenecks

A listless session saw stocks finish little changed, as the S&P 500 and Nasdaq 100 remain rangebound near their respective high-water marks. U.S equities beat around the bush amid concerns that future earnings of large multinational corporations would be hurt by a global minimum corporate tax. Asian markets likely to follow the wall street and may start slightly higher.

USDINR

USDINR June futures fell below short term moving average on Monday.

It has formed bearish candle with open and high remained same after doji candlestick patter in previous day indicating continuation of bearishness.

Momentum oscillators and indicators also turned weak on daily and hourly chart suggesting weakness in the pair.

USDINR June futures has support at 72.70 and breaking of the same will open for 72.40 while on higher side 73.30 remains the resistance.

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