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Market Round up

* The Indian rupee is expected to decline against the dollar at open as weak U.S. data and rate hikes by central banks prompted investors to exit risk assets. The rupee is likely to open at around 82.85 to the U.S. dollar, compared with 82.76 in the previous session. Implied opening from forwards suggests spot USDINR may start trading around 82.85.

* Spot USDINR climbed 0.4% to 82.7538 on Thursday, in line with the Asian currencies. Technical set-up remains bullish amid the higher tops and bottoms forming on all time frames.

* Asian shares are trading with losses on recession fears in the U.S. and hawkish commentary by major central banks, following their U.S. counterpart.

* The S&P 500 closed at its lowest level in more than a month and the dollar climbed the most since September as investors sought haven assets after warnings by the Federal Reserve and the European Central Bank of more pain to come.

* The safe-haven dollar held just below the month's high against the yen and maintained overnight gains versus other peers amid growing worries that continued monetary tightening at the world's biggest central banks could trigger a recession.

* After the Federal Reserve and Bank of England, the European Central Bank followed with a rate hike of 50bp. The ECB also announced it would start to reduce its bond portfolio, aka quantitative tightening, from March 2023 onwards

* Federal Reserve Bank Credit remained unchanged at $8.55 trillion. Interest-bearing assets on the Fed balance sheet are about 4% below the March highs, and $83 billion below their mid-November levels.

USDINR

Technical Observations:

* USDINR Dec fut headed higher on Thursday and held the bullish chart formation of the higher tops and bottom on the hourly chart.

* The pair is having resistance at 83.30, the upward-slopping trend line.

* It has support at 82.40, the recent swing low.

* The derivative data indicates short covering in the pair with a rise in the price and a decline in the open interest.

* Momentum oscillator, RSI is currently placed above 50 and heading north suggesting bullish momentum.

* The above technical evidence suggests a continuation of a bullish trend and we may see USDINR Dec fut breaking the level of 83 and 83.30. Our bullish view will be negated only below 81.70.

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