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  3. Forex pair update for the week 17 to 21 July 2023

Forex pair update for the week 17 to 21 July 2023

USD/INR

Past week saw a reversal of previous weeks move and closed around 82.02. As observed in the previous blog the declines are used as opportunity to hedge the Imports. Once again, the markets would be looking for lower levels to hedge imports. However, when the DXY has breached crucial 100 mark, there are no reason that the USDINR currency pair holds on to this range. This week is crucial and there are possibilities of lower levels towards 81.55 and then 81.15. If fails then there could be a wait period of another three weeks. In such scenario we may expect a consolidation between 81.75 and 82.75. There could be choppy moves within this range. A close outside this range requires re-assessment of risk/direction and target.

A few more observations:

  • Neither the moves in Dollar Index-DXY nor the equity have direct correlation.
  • The raising upward channel indicate the broader range of 77.10-83.30.
  • Unlike in the past, the Imports (mainly the oil) are being hedged as and when there are lower prices in Oil and/or lower prices in the currency pair.
  • As noted in the previous blog, continue to keep the following input for quick reference.
    The 82.75-83.25(with error adjustments) zone is the Fib projection of July 2011 to July 2013. Hence, the importance. If breached, we may see another spike towards 85.70.
    This range is continuing to be protected.
    A deeper correction is long overdue. Market is expecting 81.70-83.10 will be protected. If appears that the same kind of yo-yo moves may continue till one more quarter if we do not see a close below 81.70.
    A decisive week ahead.

With this back drop it would be preferable to hedge the outward remittances on decline towards 81.55 or lower if seen. Current foreign exchange rate of USD/INR is 82.05.

EUR/INR

Current EURINR exchange rate is 92.11. The Currency pair did not even attempt levels closer to 90 during the during the past week. The currency pair managed to post a strongly bullish candle and posted a high of 92.34 and broke the crucial resistance at 90.66. The Momentum is expected to remain intact and the pair is expected to trend higher closer to 94 levels. Expected to undergo consolidation phase between 90.50 & 93.50. Any breach of the range would lead to 100 pips move.

From a remittance perspective it would be prudent to book any outward remittances on slide towards 90.55 levels and the inward remittances by selling EUR currency against INR around 93.50 or higher if seen.

GBP/INR

The GBPINR currency pair is breached the upward channel top at 106.35 and made a strong bullish candle. The current exchange rate of GBPINR is 107.75. The pair is well supported at the previous top of 105.25. As expected the pair broke the barrier and stretched beyond the expected target of 106.35. The currency pair is expected to move in a range of 105.25 & 108.85. It may be prudent to liquidate/hedge inward remittances on any upticks towards 108.35 levels by selling GBP currency against INR.

it is desirable to hedge outward remittances on any decline towards 105.25 or lower if seen. Any close outside the range of 105.25-108.85 might require re-assessment of risk.

AED/INR

The current exchange rate of AEDINR is 22.33. The AED being pegged currency, AEDINR pair follows the USDINR moves. For now, the pair is expected to consolidate between 22.25 and 22.45. We may have to watch for breach on either side for a new 30 pips range. With this theme in mind the outward remittances may be hedged at the current levels or on any decline towards 22.25. A daily close below 22,25 would make the pair vulnerable for further decline towards 21.90.

THB/INR

The current Exchange rate of THB currency against INR is at 2.3652. After the Candle confirmation the pair has started moving higher and as expected the pair attempted a strong pull back to test 2.3807 and closed at 2.3652. Expected range for the week is 2.3475-2.3850. Any close outside the range to be assessed a fresh for direction and target.

The outward remittances can be hedged on any decline towards 2.3475 or lower if seen and inward remittances on any spike towards 2.3850.

CAD/INR

The current exchange rate of CAD/INR currency pair is 62.07. The pair seem to have strong barrier at 62.60. It made a red candle. The pair continues to move in an upward channel with support at 61.22 and resistance at 62.75. The range expected for the current week is in a band of 61.30-62.70.

With this back drop its wiser to hedge the inward remittances by selling CAD currency against INR on any spike closer to 62.70 or above and hedge the outward remittances by buying CAD currency on any decline closer to the lower end of the range.

MYR/INR

The MYRINR currency pair broke the steep downward sloping channel resistance top at 17.80 and moved sharply to scale 18.18. Current exchange rate of CADINR currency pair is 18.11. Any retracement will be treated as opportunity to buy. Expected range for the week is 17.80-18.30. Preferable to hedge the commitments of outwards remittances on any decline towards 17.80. his currency pair is known for its characteristic move of alternate bullish and bearish candles. Hence, suggested to hedge the inward remittance close to 18.30 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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