Nifty & USD/INR Report – 14th June, 2012

Daily Nifty Analysis

Nifty Analysis_14.06.2012_xDirect India

Indian equity indices managed to pull back from session lows, they closed just marginally higher, as uncertainty over the RBI policy action on June 18th kept market players wondering on the result that would affect the outcome to Indian capital markets. The undercurrent was also cautious before the release of the latest WPI inflation report on Thursday. Major Asian markets posted decent gains while the European markets were trading nearly flat after a higher start. Worries over the euro zone credit crisis persisted ahead of Italian bond auction later this week and Greek Elections on June 17.
There was a volatile trading session witnessed in Nifty yesterday, where it ended the session with a mere 18 points gain; however did scale up over the resistance line of 5100 levels, poising to touch 5150 levels for the day; however we do have the WPI data that is to bee reported which may cause some amount of rift as traders gear up for the RBI rate policy decision next week.
Support lies in at interim levels of around 5100, followed by 5080-5075 levels and then 5025levels. If there are dips in the market then it should be as an opportunity to buy in the market; however on the global front we do have Greece elections to come up this Sunday. Resistance at 5150 followed by 5210 (38.20% retracement is witnessed)

View on Indian Rupee

USD/INR Analysis_14.06.2012_xDirect India

The currency market remains indecisive yesterday  before  the  crucial  Greece election on 17th June and Italian bond sale which is due today. In the global market, the EURUSD remained higher despite Moody’s cuts Spain rating to Baa3 from A3. Further cuts may come, according to Moody’s, warning that the country may eventually be cut to junk. Spain’s is not in a position for A or BAA ratings, the agency said. We presume due to dismal data on the retail growth in US that reported an unchanged improvement from its previous levels of -0.20% states that US consumers hasn’t revived their consumption habits, in which the nation thrives on.

Indian Rupee Intraday Outlook:
However after the initial rally till 1.26 on EUR/USD there was a slight pullback however we presume that some sort of risk-off  trigger  if  provided  then  a downside on EUR/USD could result in US Dollar buying eventually pushing USD/INR once again to over 56.00 levels.
We expect USDINR to trade sideways with Italian bonds which would be in focus for today. A good bid on the auctions would definitely play a good role in risk –on environment   giving   boost   to   INR appreciation.

 Report By
xDirect India
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