ICICI Direct expects USDINR to find supports at lower levels. Utilise the downsides in the pair to initiate long positions.
ICICI Direct's currency report on USDINR
Spot Currency
The rupee weakened on Friday amid strength in the US$ as well as rising oil prices. It is expected to open slightly stronger today while caution ahead of general elections as well as firm oil prices would cap appreciation • The US dollar ended lower on Friday as a bounce in the Euro as well as GBP supported risk on mode. Brexit delay has created uncertainty although it has alleviated the no-deal exit risk as of now. Going forward, the direction of US-China trade talks as well as incoming economic data, especially from EU, are likely to be key monitorables.
Benchmark yield
Sovereign benchmark treasury yields rose to 7.41% on Friday. Also, FII flows in April have been negative till date against huge inflows seen in March • US treasury yields climbed 7 bps to end at 2.57%. Hopes of potentially positive directions of US-China trade talks is keeping US yields supported while dovish Fed minutes would keep a sharp rise in check.
Currency futures on NSE
The dollar-rupee April contract on the NSE was at 69.35 in the previous session. April contract open interest increased 1.58% in the previous session • We expect the US$INR to find supports at lower levels. Utilise the downsides in the pair to initiate long positions.
Intra-day strategy
| US$INR April futures contract (NSE) | View: Bullish on US$INR |
| Buy US$ in the range of 69.13-69.20 | Market Lot: US$1000 |
| Target: 69.35 / 69.45 | Stop Loss: 69.01 |
| Support | Resistance |
| S1/ S2: 69.20 / 69.05 | R1/R2:69.40 /69.55 |
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