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Market Round-up

* The rupee closed at a record low due to increased dollar demand from oil companies and foreign banks purchased on behalf of its custodian clients; however, the RBI intervened to stop the rupee from a sharper fall.

* The dollar index closed for its first back-to-back weekly drop since July, after mixed US macro data and traders anticipate the Federal Reserve will take a less aggressive approach.

* Inflation and employment growth in the US economy tend to be declining, and disappointing S&P PMIs indicated that the economy was weakening.

* Treasury yields advance across the curve; US 10-year gains by 0.70% to 4.47; bonds pressured after German yields jumped on the government's announcement of debt-brake suspension.

* The euro is grinding higher against the US dollar, registering a straight-second weekly gain. The pair has rallied almost 5% from early October's low of 1.0448.

* USDINR Outlook: In a broader sense, the rupee has underperformed in the recent dollar decline, and we anticipate the same trend will continue in the short term. The USDINR pair has neither closed below 83.20 nor moved above 83.45 in the last few weeks. Any break above 83.45 will take it to 83.60, and a move above 83.60 may take it to the 84.0 level. On the flip side, below 83.20, the next support is at 83.0/82.80.

* Week Ahead : The main focus this week is on the Federal Reserve’s preferred inflation measures tool, the PCE price index, which will be published on Thursday. The US GDP data will be released on Wednesday. Manufacturing PMI data from China and the US will be published on Thursday and Friday, respectively.

USDINR

Technical Observations:

* USDINR pair hovering above the 21-day exponential moving average. It has been trading in the range of 83.20 to 83.45.

* Momentum oscillator, RSI has been placed slightly above 50 and flatten indicates neutral momentum.

* The pair has support at 83.0 and resistance at 83.60.

* Looking at the above technical evidence, chart patterns and derivative data, the outlook USDINR turns neutral.

* Buy USDINR Dec Fut above 83.45 SL 83.36 Target 83.60

USDINR Dec Futures Daily Chart

EURINR

Technical Observations:

* The EURINR pair was well placed above the 50-DEMA. The price is forming a higher high and a higher bottom on the daily chart, and we expect the same trend to continue in the short term.

* Momentum oscillator RSI has been placed near the 70 mark and indicates bullish momentum.

* A long buildup has been seen as the price increased, and open interest and volume were also gained.

* The pair has support at 90.00 and resistance at 92.80.

* Buy EURINR Dec Fut at 90.70 SL 88.40 Target 92.50

EURINR Dec Futures Daily Chart

GBPINR

Technical Observations

: * GBPINR Dec fut formed a higher high and a higher bottom, and positive moving averages crossed over to indicate a bullish trend.

* The pair has support at 102.95 (50 DEMA) and static resistance at 105.80.

* A relative strength index of 14 days near 70 with upward directions is indicating a bullish trend in place.

* Buy GBPINR Dec Fut at 104.25 SL 103.00 Target 105.50

GBPINR Dec Futures Daily Chart

JPYINR

Technical Observations:

* JPYINR Dec fut pull back from high of 57.0 and closed slightly below 20DEMA.

* The pair has static resistance at 57 and support at 55.80.

* The price is expected to trade in this range in short term.

* The Relative Strength Index of 14 days has been turned negative but placed above its moving average.

* Sell JPYINR Dec Fut at 56.50 SL 57.20 Target 55.0

JPYINR Dec Futures Daily Chart

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