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  3. Currency Views for the Week 05 Dec – 09 Dec 2022-Venkat's Blog

Currency Views for the Week 05 Dec – 09 Dec 2022-Venkat's Blog

USD/INR

The pair moved in a range of 81.00-81.83 during last week. However, the Monthly candle confirms the trend reversal. We can safely assume that the top at 83.10-83.30 is expected to hold for the current month and possibly till the year end. The closer resistance at 81.80 itself is likely to see good amount of supply. We are witnessing demand driven by lower crude and outstanding unhedged exposure getting covered. The ultimate projection for the down move is 79.20 which might take a couple of weeks. The indications are that the currency is expected to consolidate between 80.70 82.70. A close outside this range requires re-assessment of risk/direction and target.

A few more observations:

  • In the previous blogs the comparative analysis of 2018 & current scenario was discussed and suggested a possible correction in Nov 22 which is in progress. We saw nearly a 4 big figure correction in 2018. If the same were to repeat, we may see 79.20 soon.
  • The long term trend line till at 83.10-83.30 levels holds for now and we are likely to see a consolidation between 79-82
  • We may not see a runaway in DXY. The 105-106 range is yet another crucial price point and we may see further fall to 102
  • The full impact of the correction has not yet been seen in USDINR currency pair.
  • Slow paced correction is a cause of concern as we have seen sudden sharp moves after a long periods of still/stale moves.
  • The raising upward channel indicate the broader range of 80.10-82.70

With this back drop it would be preferable to hedge the outward remittances on decline towards 80.50 or lower if seen. Current exchange rate of USD/INR is 81.41.

EUR/INR

Current EURINR exchange rate is 85.80. The pair saw volatile moves. There is no looking back for the EURINR currency pair and it posted a high of 85.85 and closed near the high. Downside risk seems limited till it closes below 83.70. We can expect a consolidation between 84.00-86.40. Any breach on either side on a daily closing basis would require re-assessment of risk. It is prudent to look for key levels to hedge the risk. The run up has been too sharp and we need to expect the consolidation.

From a remittance perspective it would be prudent to book any outward remittances on slide towards 84.20 levels and the inward remittances by selling USDINR currency EUR currency against INR around 86.50 or higher if seen.

GBP/INR

The GBPINR currency pair is gaining for the fourth consecutive week and continued to remain volatile. The current exchange rate of GBPINR is 100.03. Decisive break of 98.30 makes the pair to remain biddish. The currency pair may find strong resistance at 101.30. The currency pair is expected to move in a range of 98.30 & 101.30. It may be prudent to liquidate/hedge inward remittances on any upticks towards 101.30 levels by selling GBP currency against INR.

it is desirable to hedge outward remittances on any decline towards 98.50 or lower if seen. Any close outside the range of 98.30-101.30 might require re-assessment of risk.

AED/INR

The current exchange rate of AEDINR is 22.18. The AED being pegged currency, AEDINR pair follows the USDINR moves. For now, the pair is expected to consolidate between 21.70 and 22.40. We may have to watch for breach on either side for a new 40 pips range. With this theme in mind the USDINR currency outward remittances may be hedged at the current levels or on any decline towards 21.70. A daily close below 21,80 would make the pair vulnerable for further decline towards 21.50.

THB/INR

The current Exchange rate of THB currency against INR is at 2.3441. The currency pair has been consistently making higher price levels. Decisive break of 2.32 makes the pair positioning itself for an attempt of 2.3650. A daily close below 2.3160 would be a sign of temporary pull back towards 2.2830. Expected range for the week is 2.3160-2.3650. Any close outside the range to be assessed a fresh for direction and target. Only a close below 2.2800 would be considered as reversal.

The outward remittances can be hedged on any decline towards 2.3160 or lower if seen and inward remittances on any spike towards 2.3650.

CAD/INR

The current exchange rate of CAD/INR currency pair is 60.77. The pair made a failed attempt to break the barrier at 61.10. A daily close above 61.10 is required for higher levels. The range expected for the current week is in a band of 59.90-61.50.

With this back drop its wiser to hedge the inward remittances by selling CAD currency against INR on any spike closer to 61.00 or above and hedge the outward remittances by buying CAD currency on any decline closer to the lower end of the range.

MYR/INR

As expected the MYRINR currency pair moved higher and closed around the top of the range suggested in the previous blog. Current exchange rate of CADINR currency pair is 18.53. Expected range for the week is 18.10-18.80. Preferable to hedge the commitments of outwards remittances on any decline towards 18.00. This currency pair is known for its characteristic move of alternate bullish and bearish candles. Hence, suggested to hedge the inward remittance around 18.80 or higher levels if seen.

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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