Currency Views for the Week 01 Aug – 05 Aug 2022-Venkat's Blog
As observed in the previous weekly report 80.30 is crucial level for USDINR currency pair. The pair attempted to hold on to 79.70 and finally gave way for a slide towards 79.16. With Friday’s move the expectation is that there would be more sellers emerging with every spike. Hence, it is prudent for the NRIs and the beneficiaries of the inward receipts in #USD currency to sell on any spike till 80.10. For any reason if we see a cross-over of 80.10 the USD currency sell can be postponed for a couple of sessions/ The commitments on outward remittances for study abroad or travel related may wait for price drop towards 79.10 to book or to cover in case seen above 80.10. The global risk scenario seems to ease with the stable crude prices which in turn would help ease inflation. If the USDINR currency pair maintains a close below 79.50 till this week we may see the currency pair moving towards 78.60. Expect a consolidation between 78.80
and 80.10. A daily close outside this range requires re-assessment of risk/direction and target.
EUR INR currency pair is creating second base around 80.40-80.60 range. It is also observed that 81.20 is restricting further upside. The indicators are turning positive and expect the resistance at 81.20 to give-up for an attempt of 82.30. Going forward 80.50 could act as a strong support. It is prudent to look for key levels to hedge the risk. From a remittance perspective it would be prudent to book the outwards remittances buying EUR currency against INR below 81 on any sharp decline towards 81-80.50 range. Inward remittances would be ideal to hedge by selling EUR against INR currency on any spike towards 83.10 or higher. First hurdle seen around 82.30 and on a daily close above could quickly take the pair to 83.20 which almost matches with the target based on the Hammer candle seen in the previous week. Expected range for the week 80.50-83.50
The GBP currency against INR has gained considerably to close above 97. This currency pair is known for its volatile moves. Normally the GBP currency moves by INR 3.00 in a week. Expect the same trend to continue till we see a break on either side of the range of 95.75- 97.25. Ideal to liquidate/hedge inward remittances on upticks close to 97 by selling GBP currency against INR. Downside seen limited to 95.75 and the bias appears to be on the upside which could be on account of GBP appreciation. Good to hedge outward remittances at current levels or any decline. Current Rate is GBP= INR 96.55 Expected range for the week 95.75-97.25. Any close outside the range might require re-assessment of risk.
AED is almost a fixed or low range Foreign Currency pair. Ideal to watch USDINR moves and hedge the positions. For now, the range appears to have shifted lower to 21.30-21.75. We may have to watch for breach on either side for a new 30 pips range. Technically the oscillators appear to be showing signs of downward bias. The hedge can be taken in the suggested range.
The current Exchange rate of THB currency against INR is at 2.1850. While there has been strong pressure on the THBINR currency pair, it is observed that the long term support at 2.1775 held well and the currency pair is edging higher. It is likely that we may see the pair moving towards the break-out level of 2.2000 with one level of resistance at 2.1950. The bias seems to on neutral. Expected range for the week 2.1775-2.2000. The hedges for remittances can be made within this range. Any breach would require re assessment of risk.
We may see the CADINR Currency pair edge higher. For now, the risk assessment appears to be favoring an upward bias. Only a daily close below 61.20 could see the pair drift lower towards 60.70. Expected range for the week 61.50-62.50. With this back drop its wiser to hedge the outward remittances by buying CAD currency against INR on any decline towards closer to 61.50 or lower and hedge the inward remittances by selling CAD currency on a spike closer to the top side of the range or higher.
Disclaimer: The views expressed here by author are his personal views for learning and reference purpose only. Orient Exchange does not take responsibility for the views expressed.
Author Name: Mr.Venkata Raman
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