Currency Views for the Week 14 Nov – 18 Nov 2022-Venkat's Blog


USD/INR

There seems a big relief for the importers as the market finds strong selling interest emerging. As observed in our earlier blog the pair cleared 81.10 and tested further lows.With this sharp down move the market would find sellers emerging on every raise. A daily close below 80.10 could trigger further stops and we may see the Fib support at 79.20.However, there could be strong buying interest around 80.10 which is the Trend line support and also the earlier break-out level.Expected range 79.20-82.10. 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 79-81.
  • The DXY breaking the strong 110 is a sign of top in place for USD index. We may not see a runaway in DXY. The full impact of the correction has not yet been seen in USDINR currency pair, the fall in DXY might have given a sigh of relief for many Central Banks.
  • We do not see an immediate threat of crossing 83.
  • The raising upward channel indicate the broader range of 80.10-82.70.
  • The increased volatility and wild swings likely to continue.

With this back drop it would be preferable to hedge the outward remittances on any at the current levels or on decline below 80. Current exchange rate of USD/INR is 80.50.

EUR/INR

Current EURINR exchange rate is 83.35. The pair saw volatile moves. The downward sloping trend line starting from Apr 21 held well and on break of 82.20 the pair swiftly moved to the target of 83.40. Downside risk seems limited till it closes below 81.30. We can expect a consolidation between 81.40-84.50. 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. Daily close above 83.70 could trigger a sharp move towards 84.70.

From a remittance perspective it would be prudent to book the any outward remittances on slide towards 81.80 levels and the inward remittances by selling EUR currency against INR around 84.70 or higher if seen.

GBP/INR

The GBPINR currency pair continued to remain volatile. The currency pair recovered sharply the loses made during the previous week and closed at the current exchange rate of GBPINR is 95.30 which is just below the intermediary trend line starting July 22. The weekly candle is a bullish candle. The pair is likely to attempt the crucial resistance at 95.80. Daily close above 95.80 would see quick move to 97.70. The currency pair is expected to move in a range of 92.50 & 97.50.

It may be prudent to liquidate/hedge inward remittances on any upticks towards 97 levels by selling GBP currency against INR. it is desirable to hedge outward remittances on any decline towards 93.00 or lower if seen. Any close outside the range of 92.50-97.50 might require re-assessment of risk.

AED/INR

The current exchange rate of AEDINR is 21.92. The AED being pegged foreign currency, AEDINR pair follows the USDINR moves. For now, the range seems shifted further lower to 21.70-22.30, following correction in USD across the board. We may have to watch for breach on either side for a new 40 pips range. With this theme in mind the outward remittances may be hedged at the current levels or on any decline towards 21.70. A daily close below 21,80would make the pair vulnerable for further decline towards 21.50.

THB/INR

The current Exchange rate of THB currency against INR is at 2.2380. As expected the currency pair gradually picking up the lost ground and hit the break down level of 2.2000 and regained the lost ground and moved beyond the barrier and closed at 2.2380. Now the pair may attempt still higher levels taking support of 2.2200. The pair is expected to consolidate in a range of 2.2100- 2.2630. Any close outside the range to be assessed a fresh for direction and target. Only a close below 2.1930 would negate the up move. The remittances are to be hedged accordingly.

The outward remittances can be hedged on any decline towards 2.2100 or lower if seen and inward remittances on any spike towards 2.2550.

CAD/INR

For the past 3 weeks, the CAD/INR currency pair is seen consolidating in a narrow range of 60.10 -61.10. The pair also seems to have come back on track with the base at 59.30 levels holding well. The range appears to have shifted higher to 60.40-61.40. Current Exchange rate of CADINR currency pair is 60.75. A daily close above 61.10 required for higher levels. The range expected for the current week is in a band of 60.40-61.40. With this back drop its wiser to hedge the inward remittances by selling CAD currency against INR on any spike closer to 61.40 and hedge the outward remittances by buying CAD currency on any decline closer to the lower end of the range.


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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