HSL PCG CURRENCY DAILY

25 January, 2017

PRIVATE CLIENT GROUP [PCG]

 VIEW POINT
STRATEGY FOR THE DAY Rupee Slow Recovery After Flat Start
Indian rupee on yesterday closed marginally higher against the US
dollar after local equity markets gained for the second consecutive
USDINR Range Bound 68.30 to 67.90 sessions. Both domestic and foreign funds were buyer in domestic
equity market as per the provisional data. The local currency closed at
68.15 a dollar--up 0.10% from Monday's close of 68.22.
In the absence of fresh triggers and Union Budget on first
MAJOR CURRENCY February, the bond markets were stuck to a very thin band and volumes
also remained sluggish. The 10 year benchmark yield was in a
Prev. range of 6.43-6.44% for most of the session before ending the
Close Chg. % Chg.
Close day at 6.44% vs 6.45%.
USDINR 68.145 68.215 -0.070 -0.10% The one month forward USDINR non-deliverable forwards quoting at
DXY INDX 100.210 100.350 -0.140 -0.14% 68.40 from yesterdays 68.40 indicating flat opening at domestic
bourses. We remains neutral to bearish till pair surpasses immediate
EURUSD 1.073 1.073 0.000 0.02%
resistance of 68.40 in spot basis. However, the lower side also capped
GBPUSD 1.253 1.252 0.001 0.09% around 67.70.
USDJPY 113.460 113.790 -0.330 -0.29% Dollar Steady after gain in US Treasury
DG USDINR 68.190 68.190 0.000 0.00% The dollar steady near psychological level of 100 with a rebound in
Treasury yields helping the greenback pull away from recent lows
GLOBAL INDICES plumbed against the yen and euro amid concerns about U.S. President
Donald Trump's protectionist stance. The dollar index went as low as
99.922 yesterday, with the initial elation tempered by Trump's inaugural
Prev. speech last week that was heavily slanted toward trade protectionism.
Close Chg. % Chg.
Close The index last stood at 100.21. U.S. Treasury yields rose on Tuesday as
SGX NIFTY 8508.5 8485.5 23 0.27% investors snapped up equities on improved outlook on corporate profits,
NIFTY 8475.8 8391.5 84 1.00% trimming their safe-haven demand for bonds.
Pound recover after Supreme Court Judgement on Article 50
SENSEX 27375.6 27117.3 258 0.95% The pound fell immediately after the UK Supreme Court ruled that the
HANG-SENG 23003.8 22949.9 54 0.23% Government must hold a parliamentary vote to trigger the start of
NIKKEI 18994.3 18788.0 206 1.10% official negotiations to exit the European Union. However, overnight it
SHANGHAI 3144.5 3142.6 2 0.06% covered the losses and last quoted near level before the judgement. The
cable last stood at 1.253 with 0.10% gains/
S&P INDEX 2280.1 2265.2 15 0.66%
Supreme Court judges rule that an Act of Parliament is required to
DOW JONES 19912.7 19799.9 113 0.57% trigger Article 50, by an 8-3 majority. Theresa May doesn't have to
NASDAQ 5601.0 5552.9 48 0.86% consult regional assemblies as part of process; good news for the prime
FTSE 7150.3 7151.2 -1 -0.01% minister. What form legislation takes is "entirely a matter for
CAC 4830.0 4821.4 9 0.18% Parliament.
The near term bias for the pound remain volatile on uncertainty. Market
DAX 11594.9 11545.8 49 0.43% had already discounted Hard Brexit anything below will pull currency at
higher level.

PRIVATE CLIENT GROUP [PCG]

 TECHNICAL OUTLOOK

SPOT USDINR DAILY CHART

Technical Observations

USDINR pegged near short term moving average of 20 days indicating consolidation.
Momentum oscillators RSI given negative divergence suggesting weakness in the pair.
The pair could head lower towards 67.70, the previous bottom, and face resistance at 68.39.
The short term bias turn neutral to bearish with downside support at 67.715 and 67.3250 until it surpass 68.3875.

PRIVATE CLIENT GROUP [PCG]

TECHNICAL LEVELS

Contracts Last Pivot S3 S2 S1 R1 R2 R3 View For The Day

USDINR JAN17 68.16 68.15 67.98 68.03 68.09 68.21 68.26 68.33 Range bound
EURINR JAN17 73.16 73.22 72.84 72.99 73.07 73.31 73.46 73.55 Long Unwinding
GBPINR JAN17 84.87 85.01 84.08 84.44 84.65 85.23 85.59 85.81 Long Unwinding
JPYINR JAN17 60.15 60.29 59.43 59.76 59.96 60.48 60.81 61.01 Short Covering

Wkly Wkly 1-Mth. 1-Mth. 52 Wk 52 Wk

Spot 5 DMA 20 DMA 50 DMA 100 DMA 200 DMA
High Low High Low High Low
USDINR 68.27 67.89 68.39 67.43 68.86 66.07 68.15 68.13 68.07 67.41 67.19
EURINR 72.81 72.08 73.35 70.42 77.49 70.42 72.84 72.04 72.06 73.12 74.18
GBPINR 84.22 81.78 85.62 81.78 100.49 80.89 84.22 83.55 84.38 84.38 88.42
JPYINR 60.24 59.09 60.49 57.25 68.11 55.73 59.73 58.94 59.30 61.99 62.88

CURRENCY MOVEMENT
Open Chg. in Chg. in
Currency Open High Low Close Chg. Volume
Interest OI Volume
SPOT USDINR 68.06 68.18 68.04 68.15 -0.07 -- -- -- --
USDINR JAN. FUT. 68.12 68.20 68.08 68.16 -0.07 1453629 -88420 781498 47349
SPOT EURINR 73.35 73.35 73.12 73.15 -0.05 -- -- -- --
EURINR JAN. FUT. 73.31 73.37 73.14 73.16 -0.06 26456 -5291 32190 -6952
SPOT GBPINR 85.32 85.34 84.75 84.82 -0.09 -- -- -- --
GBPINR JAN. FUT. 85.25 85.38 84.80 84.87 -0.09 20160 -7501 101841 22208
SPOT JPYINR 60.46 60.49 60.07 60.11 0.13 -- -- -- --
JPYINR JAN. FUT. 60.62 60.62 60.10 60.15 0.13 12991 -1499 26066 -7756

PRIVATE CLIENT GROUP [PCG]

 ECONOMIC EVENTS RELEASED
Date Time Country Event Period Survey Actual Prior

01/24/2017 14:30 EC Markit Eurozone Manufacturing PMI Jan P 54.8 55.1 54.9
01/24/2017 14:30 EC Markit Eurozone Services PMI Jan P 53.9 53.6 53.7
01/24/2017 14:30 EC Markit Eurozone Composite PMI Jan P 54.5 54.3 54.4
01/24/2017 20:15 US Markit US Manufacturing PMI Jan P 54.3 55.1 54.3
01/24/2017 20:30 US Existing Home Sales Dec 5.55m 5.49m 5.61m
01/24/2017 20:30 US Richmond Fed Mfg. Index Jan -- 12 8

ECONOMIC EVENTS TODAY

Date Time Country Event Period Survey Prior

01/25/2017 17:30 US MBA Mortgage Applications 20-Jan -- 0.80%

PRIVATE CLIENT GROUP [PCG]

 Technical Analyst: Vinay Rajani (vinay.rajani@hdfcsec.com)
Currency Analyst: Dilip Parmar(dilip.parmar@hdfcsec.com)

HDFC securities Limited, I Think Techno Campus, Building - B, "Alpha", Office Floor 8, Near Kanjurmarg Station, Opp. Crompton Greaves, Kanjurmarg (East), Mumbai 400 042
HDFC securities Limited, 4th Floor, Astral Tower, Above HDFC Bank Ltd, Nr.Mithakhali Six Roads, Navrangpura, Ahmedabad 380009.
Phone: (079)66070168, Website: www.hdfcsec.com Email: pcg.advisory@hdfcsec.com

Disclosure:

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PRIVATE CLIENT GROUP [PCG]