MF Global Currency Report, June 21

[Shah, Vikas (IND Int)]

 

Market Outlook:

Spot USDINR has opened at 44.91 from 45.00. USDINR could trade between 44.75-44.80-45.10 range. Session start could see a brief spurt in rupee, mostly tracking the overnight gains in Euro versus the dollar. On domestic front, despite the assurances from government that there would be no arbitrary tax levy on inflows from Mauritius, the markets are likely to stay cautious on likely impact on FDI in India and about the details of reworked treaty, when the two counties officials meet.

Overseas, Greece continues to remain under scanner as PM Papandreou faces confidence vote today. Voting on passing the new austerity measures totaling to about 78 billion euros, though could be delayed until June end. EU finance ministers who decided to withhold the 12 billion euros tranche, meanwhile have given Greece until Jul 3, to pass the vote to adopt measures, but have also been firm, that if such measures are not adopted there would be no release of next tranche.

Focus also will be on US FOMC 2-day FOMC meet, which gets underway, on Fed's view on interest rate regime and on whether it would consider another round of monetary easing.

 

 

Technical trade outlook:

USDINR: Support at 44.7, 44.48, 44.2 Resistance at 45.2, 46.01. Expect range trading between 44.7 to 45.2

EURINR: Support at 62.9, 62 Resistance 64.2, 64.7, 65.1.In a consolidation trend between 63 to 65.5, for theday initial declines to hold at 63.9 and test 64.5

GBPINR: Support at  71.8, 71 Resistance at 73.3, 73.75. Expect weakness extend further lower towards 71.8 and and close below that to 71 while 73.3 remains capped on higher end. 

JPYINR: Support at  55.3, 54.68, 53.9 Resistance at 56.22, 56.9, 57.5. Close above 56.22 will make for higher levels failing which trend to remain sideways in range to 54.68

 

EURUSD: Support at 1.425, 1.412, 1.408 Resistance at  1.437, 1.4412, 1.460. Relief rally seen while support at 1.425 is held with potential to test 50-day MA at 1.4412. Only a close above 1.4412 to induce fresh buying interest.

 

 

 

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