The Indian rupee opened flat on Friday at 82.55 per dollar, up just 1 paise from the previous close. The local unit is likely to depreciate amid a strong dollar and risk aversion in US markets. Rebound in crude prices is also expected to put pressure on the domestic currency. Market sentiments are hurt as strong labour market data reinforced expectations that the Fed may keep rates higher for some time. Also, investors will closely watch non-farm payrolls, average hourly earnings, and ISM Services PMI data to gauge the economic health of the country. “US$INR (January) may hold support near 82.45. As long as its sustains above this level, it may rise back to 82.80 levels,” said ICICI direct.
USDINR (spot) to trade positive
“Rupee rose marginally after falling in the last couple of sessions as the dollar retraced in the first half of the session. But the greenback rallied following robust private payrolls number from the US. Private payrolls increased more than expected in December, pointing to still-strong demand for labor despite higher interest rates. US equities fell following the report as investors fear that strong jobs numbers could push the Federal Reserve to keep raising interest rates. Today, the focus will be on the non-farm payrolls number. We expect the USDINR(Spot) to trade positive and quote in the range of 82.50 and 83.05,” said Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services.
USDINR: Trail stop loss at 83.05, book profits when contract reaches 82.40-82.30
“The USDINR 27 January futures contract extended fall and tested the key support level of 82.55. As per the daily technical chart, the pair slipped below its trend-line resistance level of 82.55 while RSI is also fetching below 50 levels. Looking at the technical set-up, MACD is showing a negative divergence on the daily technical chart and looks weak on the technical chart. If the pair sustains below 82.55 levels it could test 82.30-82.10 levels; 82.85-83.10 acts as a major resistance for the pair. Those holding short positions in the pair are suggested to trail their stop loss at 83.05 and book profits as soon as contract reaches 82.40-82.30,” said Rahul Kalantri, VP Commodities, Mehta Equities Ltd.
Any rise in Rupee spot market is a good opportunity to sell for exporters
“Dollar selling by Indian exporters has recovered on the back of expectations that the USD has topped out. The average daily dollar sales by exporters beyond the spot date rose about $1.2 billion in November and December month from $900 million levels according to data from the clearing corporation of India and this figure could rise further in Jan month too, which could support the local unit. As the global growth outlook appears gloomier, we believe India’s economic outperformance may continue, which could keep the Rupee in demand. Overall, the view remains the same. The pair is likely to top out near the 83.00 to 83.20 zone. Any rise in the spot market is a good opportunity to sell for exporters. In the near term, it is expected to fall back to 81.50-81.20 levels, where importers can look for hedging,” Amit Pabari, MD, CR Forex Advisors.
Rupee may breach 83 mark in near-term
‘The dollar moved little after the FOMC minutes even though the central bank reiterated its focus on getting the multi-decade high inflation under control, and the traders moved their focus on the NFP data. As of now, the Dollar index is stable between the 104.00-104.20 zone. The USDINR pair after breaching above the 83.00 mark has reentered the trading range between 82.50 and 83.00. Today we saw the pair make a move towards the lower end of the range. In the sessions to come, we will carefully observe the price action near the 82.50 zone. On the upside we expect the 83.00-83.20 zone to act as a resistance,” said Anindya Banerjee, VP – Currency Derivatives & Interest Rate Derivatives at Kotak Securities Ltd.
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