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Rupee heads for First Weekly Gains in Last Seven

The Indian rupee is expected to open slightly higher taking cues from stronger regional currencies. However, the rise in crude oil prices and rebound in the dollar index could weigh on the local unit. Spot USDINR, on Thursday, closed at 82.50 with a loss of 23 paise. Momentum has been turning weak for the pair in the last couple of days suggesting long unwinding. Technically, it has support at 81.90 and resistance at 82.85.

Asian shares looked poised to drop Friday following sharp swings on Wall Street as investors contended with mixed US economic data and disappointing results from tech giants

Gross domestic product data showed that the US economy rebounded after two quarterly contractions, but also highlighted that consumer spending remains under pressure because of inflation.

The euro extended losses for a second day amid a European bond rally after the ECB rate decision and comments by President Christine Lagarde Thursday. The European Central Bank raised rates by 75 basis points, though officials were not unanimous about the size of the increase and sought to avoid outlining a specific signal on December’s decision.

The yen fell against all its Group-of-10 peers on expectations the Bank of Japan would retain its ultra-low interest rates at its policy decision on Friday. The Bank of Japan is expected to stick with its rock-bottom rates, a policy that’s triggered a slide in the yen and put the BOJ at loggerheads with global bond markets. Commodity currencies stayed buoyant on oil gains.

Oil heads for a weekly gain, supported by tightness in petroleum product markets, robust US exports, and a weakening dollar

US Treasury Secretary Janet Yellen said she did not see signs of a recession in the near term as the US economy rebounded from six months of contraction, in a media interview.

USDINR November Futures Daily Chart

* USDINR November futures recovered from the October 18 low and failed to make a lower low. However, the breaching of the 13-day exponential moving average and the lower high indicates a short-term trend reversal.

* The pair is having a downward-slopping trend line resistance around 83.25.

* Momentum Oscillator, RSI exited from the overbought zone and headed south indicating weakness in the trend.

* Short build-up has been seen with a fall in price and a rise in open interest and volumes.

* Directional Momentum Index started weakening as the spread between +DI and –DI narrowed while the ADX line started weakening.

* USDINR Nov. fut. has support at 82.30 and resistance at 83.25.

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