Sell USDINR; target of 64.90 - 64.84: ICICI Direct

ICICI Direct's currency report on USDINR

Spot Currency

The rupee gained sharply against the US$ as a rebound in domestic equities along with a recovery in risk on sentiment aided gains in most emerging currencies, including the rupee • The US $ posted a decent recovery against majors as the US and China signalled towards reconciliatory talks amid escalating risks of trade wars . However, post that the US President has indicated at further imposing tariffs on $ 100 billion of Chinese imports into the US. Euro and JPY stumbled as the US $ recovered. We expect Euro to decline further amid slumping inflation growth in Euro.

Benchmark yield

Sovereign bond yields fell sharply as bonds rallied amid a recovery in risk - on sentiment as well as less - than - expected hawkish signals from RBI’s monetary policy meeting • US 10 - year yields rose to 2 . 83 % even as the US and China signalled towards soothing trade war rhetoric. US employment data for March would be keenly watched for further trends in US yields and US$.

Currency futures on NSE The near - month dollar - rupee April contract on the NSE was at 65.10. The April contract open interest increased 6.83 % from the previous day • We expect US$INR to meet supply resistance at higher levels. Utilise upsides in the pair to go short in US$INR.

Intra-day strategy

US$INR April futures contract (NSE)	View: Bearish on US$INR
Sell US$INR in the range of 65.10 - 65.16	Market Lot: US$1000
Target: 64.90 / 64.84	Stop Loss: 65.28
Support	Resistance
S1/ S2: 65.0 / 64.80	R1/R2:65.15 /65.30

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