Currency Views for the Week 25 July – 29 July 2022-Venkat's Blog
Technically the USDINR currency pair is expected to attempt higher levels as there seems to be a demand supply mismatch. At least for now, the down side seems limited to 79.10. The psychological level of 80 may bring in supply. Going forward 80.30 is crucial and expected to be protected as the final LoC is 80.70 beyond which it would create more pressure. While the global risk scenario seems to improve and the lower crude prices expected to ease inflation concerns, we may expect a pull back towards 79.10 if we see a daily close below 79.70. it should be noted that the USD has been continuously moving higher for the past several weeks and it is creating a temporary top at 80.10 levels. Hence, it is prudent for the NRIs and the beneficiaries of the inward receipts in #USD currency to sell between 80.10 & 80.40. 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. Expect a consolidation between 79.30 and 80.60. A daily close outside this range requires re-assessment of risk/direction and target.
As expected the EUR INR currency pair could find support around 79.20.-79.50 range and moved towards 82.20 thus moved in the same direction expected and within the range suggested. 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 in spite of political uncertainties in the UK, Normally the GBP currency moves by INR 2.00 in a week. Expect the same trend to continue till we see a break on either side of the range of 94.75- 96.75. Ideal to liquidate/hedge inward remittances on upticks above 96.25 by selling GBP currency against INR. Downside seen limited to 94.75 and the bias appears to be on the upside which could be on account of INR depreciations. Good to hedge outward remittances at current levels or any decline. Current Rate is GBP= INR 95.80 Expected range for the week 94.75-96.70. Any close outside the range might require re- assessment of risk.
The AED/INR currency pair truly replicates the USDINR moves. The risk associated with USDINR pair directly applies here as 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 be 21.60-21.90. We may have to watch for breach on either side for a new 20 pips range. Technically the oscillators appear to be showing signs of downward bias. The hedge can be taken in the suggested range.
The downward pressure continues as the THB currency against INR seems to be under pressure with a breach of long term support at 2.2000. The current Exchange rate of THB currency against INR is at 2.1775. The bias seems to on further downside if the last support at 2.1750 breaks. The expectation is that the pair may drift lower towards 2.1500. As the market continues to off-load, it is better to sell THB currency against INR on any spike towards 2.2000 and wait for Buying THB currency at lower levels.
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
Comments and Suggestions are welcome at [email protected]