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  3. Currency Views for the Week 21 Nov – 25 Nov 2022-Venkat's Blog

Currency Views for the Week 21 Nov – 25 Nov 2022-Venkat's Blog

USD/INR

The dramatic down move followed by a sharp recovery suggest the shallow nature of the move. However, the 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. We can see huge demand due to unhedged exposure getting covered. The ultimate projection for the down move is 79.20 which might take a couple of weeks. Due to various factors 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:

  • 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.
  • 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 105-106 range is yet another crucial price point and breach would see further fall to 102. The possibilities appear to be a bit doubtful for now.
  • The full impact of the correction has not yet been seen in USDINR currency pair.
  • We do not see an immediate threat of crossing 83.
  • 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 81 or lower if seen. Current exchange rate of USD/INR is 81.61.

EUR/INR

Current EURINR exchange rate is 84.26. The pair saw volatile moves. After breaking the downward sloping trend line starting from Apr 21 there is no looking back for the EURINR currency pair and it posted a high of 84.92. Downside risk seems limited till it closes below 82.20. We can expect a consolidation between 82.40-85.40. 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. Daily close above 85.40 could trigger a sharp move towards 86.30.

From a remittance perspective it would be prudent to book any outward remittances on slide towards 82.40 levels and the inward remittances by selling EUR currency against INR around 85.40 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 97.00. Decisive break of 95.30 makes the pair to remain biddish. The currency pair may find strong resistance at 97.40. Break would see a quick move to 98.50. The currency pair is expected to move in a range of 94.50 & 98.50. It may be prudent to liquidate/hedge inward remittances on any upticks towards 98 levels by selling GBP currency against INR.

it is desirable to hedge outward remittances on any decline towards 95.70 or lower if seen. Any close outside the range of 94.50-98.50 might require re-assessment of risk.

AED/INR

The current exchange rate of AEDINR is 22.26. The AED being pegged currency, AEDINR pair follows the USDINR moves. For now, the pair is expected to consolidate between 21.90 and 22.50. 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 21.90. 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 2.2766. As expected the foreign currency pair moved higher and even surpassed the expected level of 2.2630. There can be reactive pullbacks. Yet the crucial support at 2.2500-2.2550 range is expected to hold. Expected range for the week is 2.2500-2.3000. Any close outside the range to be assessed a fresh for direction and target. Only a close below 2.2200 would be considered as reversal.

The outward remittances can be hedged on any decline towards 2.2550 or lower if seen and inward remittances on any spike towards 2.3000.

CAD/INR

The CAD/INR currency pair is seen making an 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 60.30-61.60.

With this back drop its wiser to hedge the inward remittances by selling CAD currency against INR on any spike closer to 61.60 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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