2nd April: NSE Currency Futures Weekly Report
Friday, March 30, 2018
NSE CURRENCY FUTURE WEEKLY TECHNICAL REPORT
Big first ten days (of april) for global currency markets.
In the first quarter of 2018, US dollar has gained whenever focus of the markets have been economic fundamentals and economic growth. US dollar has nosedived whenever traders/markets focused on other factors. This theme will continue for the rest of the year.
Long term market sentiment for the US dollar is very weak. There are available alternates to the US dollar in the Chinese Yuan. Central banks are diversifying there is foreign exchange reserves away from the US dollar at a pace seen between 2008-2010. Very high US trade deficit and US debt levels are a cause of concern. Trump induced trade can reduce the US trade deficit in the short term (for a year or two), but in the long term USA and large American corporations will be the loosers.
Indian economy is not out of the woods. Early advent of summer/heat wave conditions in most of India will be negative for growth. Retail inflation in India will zoom. Chances of an interest rate cut will be very low (unless the Reserve Bank of India bows to the central government). Maintenance of current growth rates will not be easy. If crude oil prices continues to rise in April, then rupee can weaken two percent against the US dollar in April.
US March nonfarm payrolls and US consumer price index (CPI) numbers will be the key economic news driver. So far I expect a June interest rate by the Federal reserve.
Yen/Inr has a big ten days (till 10th April). Traders need to be prepare for five percent either side moves on or before 10th April.
US dollar-Indian Rupee April Future
Weekly Closing Price: 65.3400
- Usd/inr can rise to 65.8300 and 66.2100 as long as it trades over 64.7400.
- A daily close over 65.8300 for four consecutive days can result in 67.2050 in the short term.
- Trading strategy: We prefer a buy on sharp dips strategy as long as usd/inr trades over 64.7400.
- Weekly Trading call: Buy around 65.2350 stop loss 64.7450 for 65.9225 and 66.2100.
Euro-Indian Rupee April Future
Weekly Closing Price: 81.0400
- 100% retracement is at 81.3050. Euro/usd needs to break and trade over 81.3050 to rise to 81.9975 and 83.2100.
- Sellers will be there as long as euro/usd trades below 81.3050.
- There can be very sharp two way price moves.
- Trading Strategy: I am against going long unless euro/usd breaks and trades over 81.3050.
- Trading call: Sell at 81.9975 stop loss over 82.4875 for 80.3075 and 79.9550.
UK Pound -Indian Rupee April Future
Weekly Closing Price: 92.5200
- 200 week moving average at 92.4700 is the key resistance. There will be sellers as long as gbp/inr trades below 92.4700.
- Key very long term resistance is at 93.3900. Gbp/inr april futures will rise to 95.5575 and 100.1950 if it breaks and trades over 93.3900 anytime in April 2018 month.
- Bearish trend reversal will be there only if there is a daily close below 91.8075 for four consecutive days.
- Trading Call: Sell at 93.3900 stop loss over 94.1125 for 91.8075 and 90.3875.
Japanese Yen -Indian Rupee April Future
Weekly Closing Price: 61.7100
- April Month view: There is a technical congestion between 62.1975-62.9900. Only a break of 62.1975-62.9900 zone will trigger another quick wave of rise to 63.6450 and 66.6225.
- Bearish trend will be under either of the two circumstances (a) Yen/inr does not break 62900 in April (b) Yen/inr has a daily close below 61.3000 for four consecutive days.
- However this week yen/inr needs to trade over 61.2875 to rise to 62.1325 and 62.9900.
- Crash will be there below 61.2875.
- Trading strategy: I am against going long unless yen/inr breaks and trades over 62.1325 with a trailing stop loss of 61.8725.
Disclaimer: Any opinions as to the commentary, market information, and future direction of prices of specific currencies, crypto currency, metals and commodities reflect the views of the individual analyst, In no event shall Insignia Consultants or its employees have any liability for any losses incurred in connection with any decision made, action or inaction taken by any party in reliance upon the information provided in this material; or in any delays, inaccuracies, errors in, or omissions of Information. Nothing in this article is, or should be construed as, investment advice. Prepared by Chintan Karnani
NOTES TO THE ABOVE REPORT
PLEASE NOTE: HOLDS MEANS HOLDS ON DAILY CLOSING BASIS
ALL PRICES ARE IN INDIAN RUPEE UNLESS OTHERWISE SPECIFIED
Indian Standard Time (IST): +5:30 GMT
Current Market Price (CMP)
All foreign exchange prices are for inter-bank rates.