Highlights

  • Indian Rupee appreciated for 4th straight session yesterday.
  • German ZEW Economic Sentiment gained to 54.6-mark in November.
  • Japan’s Trade Balance was at a deficit of 1.07 trillion Yen in October.
  • US Employment Cost Index was at 0.4 percent in Q3 of 2013.

Asian markets are trading on a mixed note today after Federal Reserve Chairman Ben Bernanke said that low interest rates in US will continue for long time even after central bank ending its bond buying program.

US Dollar Index

The US Dollar Index (DX) declined around 0.1 percent yesterday on the back of rise in risk appetite in market sentiments in early part of the trade which led to fall in demand for low yielding currency. Further, mixed concerns over QE tapering by the Federal Reserve exerted downside pressure on the currency. The DX touched an intra-day low of 80.61 and closed at 80.74 on Tuesday.

US Employment Cost Index was at 0.4 percent in Q3 of 2013 as against a rise of 0.5 percent in Q2 of 2013.

Dollar/INR

The Indian Rupee appreciated around 0.1 percent yesterday and rose for fourth straight session to trade near two week high. The currency appreciated on the back of rising inflow of foreign funds coupled with weakness in the DX. Further, upbeat market sentiments in early part of the trade after China’s central bank Governor said the Yuan’s trading band will be widened supported an upside in the currency.

Additionally, mixed concerns QE tapering from the Federal Reserve coupled with dollar demand from oil firms and importers in later part of the trade capped sharp gains in the Indian Rupee. The currency touched an intra-day high of 61.87 closed at 62.36 on Tuesday.

For the month of November 2013, FII inflows totaled at Rs.6492.00 crores ($1040.36 million) as on 19th November 2013. Year to date basis, net capital inflows stood at Rs.95425.70 crores ($17239.30 million) till 19th November 2013.

Outlook

From the intra-day perspective, we expect Indian Rupee to trade on a negative note on the back of weak market sentiments coupled with strength in the DX. Further, dollar demand from importers and oil firms will exert downside pressure on the currency. Additionally, long term worries on macroeconomic fundamentals still persists which will act as a negative factor for the Indian Rupee. However, sharp downside in the currency will be prevented on account of rising inflow of foreign funds.

Technical Chart – USD/INR

Technical Outlook valid for November 20, 2013 Trend Support Resistance US Dollar/INR Nov’13 (NSE/MCX-SX) Up 62.20/62.0 62.60/62.80

Euro/INR

The Euro appreciated around 0.3 percent yesterday on the back of weakness in the DX. Further, upbeat market sentiments in early part of the trade supported an upside in the currency.

Additionally, favorable economic data from the region acted as a positive factor. The Euro touched an intra-day high of 1.3547 and closed at 1.3538 on Tuesday.

German Zentrum fur Europaische Wirtschaftsforschung (ZEW) Economic Sentiment gained by 1.8 points to 54.6-mark in November as against a rise of 52.8-level in October. European ZEW Economic Sentiment rose by 1.1 points to 60.2-level in current month from 59.1-mark in last month.

Outlook

In today’s session, we expect Euro to trade lower on account of weak market sentiments along with stronger DX. Further, expectations of unfavorable economic data from the region will exert downside pressure in the currency.

Technical Chart – Euro

Technical Outlook valid for November 20, 2013

Trend Support Resistance Euro/INR Nov’13 (NSE/MCX-SX) Up 84.05/83.80 84.50/84.70

GBP/INR

The Sterling Pound gained around 0.1 percent yesterday on account weaker DX. Further optimistic market sentiments in early part of the trade supported an upside in the currency.

However, sharp upside in the currency was capped due to investors awaiting minutes of monetary policy meeting were Bank of England held interest rates at record low levels. The Pound touched an intra-day high of 1.6132 and closed at 1.6119 on Tuesday.

Outlook

From the intra-day perspective, we expect Pound to trade on a negative note on account of weak market sentiments. Additionally, a stronger DX will also act as a negative factor for the Sterling Pound. Further, any major announcement by Bank of England in its minutes today can cushion sharp downside or even reversal in the currency.

Technical Chart – Sterling Pound

Technical Outlook valid for November 20, 2013 Trend Support Resistance GBP/INR Nov’13 (NSE/MCX-SX) Up 100.20/100.0 100.60/100.70

 

JPY/INR

The Japanese Yen appreciated by 0.2 percent yesterday on the back of weak global market sentiments in later part of the trade that led to a rise in demand for the low yielding currency. The Yen touched an intra-day high of 99.55 and closed at 100.10 on Tuesday.

Japan’s Trade Balance was at a deficit of 1.07 trillion Yen in October as against an earlier deficit of 1.13 trillion Yen in September.

Outlook

Appreciation in the Yen is expected in today’s trade as a result of rise in risk aversion in market sentiments which will lead to rise in demand for the low yielding currency.

Technical Chart – JPY

Technical Outlook valid for November 20, 2013 Trend Support Resistance JPY/INR Nov’13 (NSE/MCX-SX) Up 62.30/62.20 62.70/62.90

 

Courtesy: angel broking

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