Forex Update for Exporters & Importers: 11th July 2018
Wednesday, July 11, 2018
TIME: 11:00 am IST
DAILY FOREX REPORT FOR EXPORTERS AND IMPORTERS
(inter-bank prices below)
- Currency markets will be very volatile.
- US Trade war news will be the key.
Trump’s additional tariff of around $200 billion Chinese goods will result in volatile currency markets. So far there has no little or no reaction seen. As the day progresses there will be a reaction. It better to ignore news and watch the technical. US dollar index is trading at 93.97. A break of resistance of 94.42 will result in 95.50. Key long term resistance is at 95.50. Watch the US dollar index.
The trade wars has resulted in importers covering there near term payables on dips. There is demand. Direction of the US dollar will dictate the rupee for the rest of the week. I suspect RBI intervention today to prevent weakness.
US dollar-Indian Rupee (usd/inr CMP 68.8250): Support: 68.7275. Resistance: 68.9525-69.1600. (a) There will be a technical breakout if usd/inr trade over 68.9525 to 69.1600. (b) Till next week as long as usd/inr trades over 68.5775 downside risk will be limited.
Japanese Yen/Indian Rupee (Jpy/inr CMP 62.0100): Support: 61.8500-62.0800. Resistance: 62.0825-62.3400. (a) Yen/inr needs to trade over 62.0825 to be in bullish zone and rise to 62.3400. (b) Yen/inr will break free from 61.50-62.75 wider trading range and form a new range.
US dollar/Japanese Yen (usd/jpy CMP 111.06): Support: 110.59 Resistance: 111.38. (a) Yen needs to break and trade over 111.38 to rise to 111.92. (b) Sellers will be there if yen does not break 111.38 today or yen falls below 110.88.
US dollar/Indonesia Rupiah (usd/idr CMP 14381.30): Support: 14316.50-14351.10 Resistance: 14412.90-14447.50 (a) There will be a technical breakout if rupiah trades over 14412.90 to 14481.60 and 14513. (b) Sellers will be there below 14351.10 only.
Why Do I ask exporters and importers to use trailing stop loss? Some day’s currency markets are very volatile. Trend (short term as well as medium term) change at the flick of coin without any advance warning. In order to make the most of the volatility it is preferable to use trailing stop loss using technical analysis as basis. Those exporters and importers do not wish to take the risk, should take a forward cover or hedge in future and options market if export or import price near cost.
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.