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Rupee Likely To Open Lower On Risk-off Moods - HDFC Securities 

Indian rupee expected to open slightly higher following stronger peer currencies and massive buying domestic equities. As per the provisional data, overseas investor bought Rs.6182cr equities on Tuesday. Risk sentiments lifted as U.S. moves on stimulus and continued good news on the vaccine.

Indian rupee closed at 72.97 a dollar with gain of 6 paise or 0.08%. Technically, spot USDINR is in down trend and could head towards 72.75, the low of September 1 while resist at 72.42, the 200 DMA

Asian stocks looked set to extend a global rally amid as stocks roared higher again on Tuesday. S&P 500 extended its two-day gains to 3% to approach its high-water mark while crumbling of the retail trading frenzy has been seen. US Treasuries remained under pressure with the 10- and 30-year yields approaching fresh 10- and 12-month highs at 1.1% and 1.87%, respectively. Elsewhere, WTI crude jumped above $55 a barrel for its best finish since January 2020, gold slipped to $1,837 an ounce, and the VIX fell below 26 to bring its two-day pullback to 23%.

Dollar index made a fresh year to date high on Tuesday, on back short covering and bullish technical signals while Japanese Yen recorded its worst loosing streak against the greenback in more than four months.

The Dollar Spot Index rose for a third day to as much as ~91.29, the highest in two months. Last DXY Index quoted at 91 slightly down from overnight high. Technically, one should eye on Sept. 2020 low and the May 2016 low at 91.75-91.92 as the next range of resistance prior to inverted head and shoulders target at 92.6. EURUSD having broken its 55d MA and trading at 1.2047. Pound continues to hover around 1.3680 at the time of writing, up 0.04% in Asian trading. It is likely to continue trading with broader risk sentiment, aided in part by local vaccination progress.

The Dollar Spot Index rose for a third day to as much as ~91.29, the highest in two months. Last DXY Index quoted at 91 slightly down from overnight high. Technically, one should eye on Sept. 2020 low and the May 2016 low at 91.75-91.92 as the next range of resistance prior to inverted head and shoulders target at 92.6. EURUSD having broken its 55d MA and trading at 1.2047. Pound continues to hover around 1.3680 at the time of writing, up 0.04% in Asian trading. It is likely to continue trading with broader risk sentiment, aided in part by local vaccination progress.

USDINR

USDINR February futures on daily chart formed “Doji Candlestick” pattern suggesting indecisiveness

On Hourly chart, the pair is having resistance of trend line at 73.27 and support at 73.10.

Broadly, the pair has been in consolidation within the range of 72.90 to 73.40.

Momentum oscillators and indicator on short term scale turned weak suggesting consolidation in the pair before breakout

We remain neutral to bearish until USDINR February futures close above 73.40 level while on downside one should look on 73.10 and 72.90 level.

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