Technical Outlook
USDINR :
Rupee on daily timeframe in technical chart suggest that market will remain
range-bound for the week. The pair is likely to find it tough to breach 54.93
level and keep continue trading between 54.41-54.91, however for dollar to
reach 55.09 level, a close above 54.93 can only confirm any further upside in
the pair.RSI is still moderate and remain in range of 50-57 last week, which
suggest Rupee is finding support on every correction and resistance on any
downfall, still far and large any directional move on either side can’t be
predicted considering the behavior of market in last few weeks. It has not
provided any confirm signal on either side and could continue so in couple of
sessions too. Still we keep our view intact on rupee that on the downside 55.70
is on chart and on upside 53.85. To confirm any direction on market it need to
breach 54.34-54.93 range. Breach of this range is likely to limited in coming
trading session. For the week rupee may strengthen if it hold below 54.87.
Fundamental Outlook
Finance
minister will seek to drum up foreign investment from the United
States and Canada this week to fund a record high current account deficit, even
as policymakers debate the risks of over-reliance on foreign investors
to finance the gap. As P Chidambaram
kicks off a week-long North America
trip, his officials are working on a series of steps to attract at least $20
billion in new investment to fund the deficit without depleting India's $300
billion in foreign exchange reserves. The proposals include raising the
cap on foreign investment in rupee-denominated government debt by up to $5
billion, reducing tax rates on such investments,
making it easier for Indian firms to borrow abroad, and easing curbs on foreign
investment in sensitive sectors such as defense, telecoms and media, finance
and trade officials told Reuters.
This week
we have two crucial data on inflation and government trade deficit. A better
than expected number both in terms of food inflation and fuel inflation could
help to change the view of RBI on rate policy. A lower trade deficit from its
previous $14.9B can ease the pressure on govt to curb CAD and helps rupee to
recover as the confidence will be better with investors.
With fundamental news input from reuters, Compiled and reported by Amit Daga.
Disclaimer : Read the
Disclaimer in earlier posts. This post is for information purpose only
and not advising any individual or organization on taking any trading
decision. The blogger may or may not have any personal interest in above
said report.
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