Nifty & USD/INR Report- 26th June, 2012

Daily Nifty Analysis

xDirect India's Nifty Analysis_26.06.2012

Benchmark indices ended weak erasing early gains, as investors were not impressed by the RBI’s measures to stem the rupee’s fall and the government did not announce any reforms as pledged last week. RBI enhanced the FII limit in G-Secs to $20 billion from $15 billion. It also allowed Indian companies in infrastructure to borrow through the ECB route up to $10 bn. The low amount of liquidity would obviously take away volatility and volumes which eventually turned out to be a negative session for the Nifty. Even the global markets were quite sticky with risk aversion combined with overselling kept the price movements range bound with the US Dollar just bouncing on every dips.

With the sudden drop in the market being witnessed yesterday, the government has announced today that it would take necessary steps to stem the Rupee depreciation; nevertheless these comments came in futile as global uncertainty has indeed gripped on the bull traders to resume on their trading with INR still hovering at its all-time low levels. For today we have a light on the counter from Euro Zone and UK, but US Consumer Confidence being the most important. However the Indian markets would trade sideways with supports coming in at interim levels of 5095 levels (Rising trend line). Followed by 5050 (50% retracement) and then 5023 (Falling trend line). Resistance is seen towards 5140, 5178 levels; however considering bearish trend has been commenced we believe Nifty has little chance of building momentum over 5180 levels for the week.

View on Indian Rupee

xDirect India's USD/INR Analysis_26.06.2012

The Indian Rupee gained sharply in yesterday’s trade bolstered by the expectations of big-bang policy measures from the Government of India and the RBI. The Rupee opened sharply higher and continued rising to make a high near the 56.3750 level. Though it weakened from day’s high and ended at 57.01 to the US Dollar after the measures  introduced by the RBI disappointed markets.

The main step announced was to increase in the cap on foreign investment in Indian government debt  to  $20  billion  from  $15  billion.  The government also reduced the minimum period investors need to hold some bonds to three years from five years, making them more attractive to foreign funds.

The Indian Rupee is expected to trade in a tight spot where in, where on the upside the resistance is seen towards 57.42 (Fibonacci extension) followed by 57.65 levels. Supports come in at 56.40 (yesterday session low). There might be some sort of positives seen in the market considering the constant selling but we believe the bear trend would resume considering the ill-liquid FOMC state,, followed by the multiple downgrades. For today however we would want the US Consumer Confidence to give some amount of boost as yesterday’s housing sales marked good numbers, its best in 3 years.

For today the market is expected to be range bound however, where European session may mark some amount of swings in the global market which may give certain movement in the currency pair.

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Nifty & USD/INR Report- 21st June, 2012

Daily Nifty Analysis

Nifty Analysis_21.06.2012_xDirect India

The choppy but somewhat positive movements in yesterday’s global market have indeed given Indian equity markets the required boost. Nevertheless the swings on both ends were provided by the fundamental trigger given by Bank of England that apparently chose to boost the stimulus regime in the economy which indeed is required for to boost the banking sector in the region. However the bets on QE kept on rising till the end of Indian markets that managed to close in the positive. The positive terrain was led by the sectors in Metals, Capital Goods, healthcare and Automotives.

Today however as the QE bets faded some amount of pressure could be eased for the markets to look forward to the negative side of the global economic scenario. Where as they have factored on the QE it is now to look forward to the fundamental triggers from the Euro Zone end, while today market has opened slightly on the flat note further swings would be provided by the reaction in the European markets.

The immediate support on Nifty comes in at 5080 levels (50% retracement) and only a breach of this would threaten in another bout of selling in the counter, where the support levels would be followed in by 5043 (falling trend line). Resistance comes in at 5140 levels and if the levels close in anywhere around or over it then we would change our bias to positive on the same, where the price action played in within the confines of this levels then it would be range -bound play.

View on Indian Rupee

USD/INR Analysis_21.06.2012_xDirect Ind

The Indian Rupee closed in the negative as despite the Indian equities managing to close in the positive did not provide the necessary boost to Indian Rupee that closed lower against the US Dollar.
Amongst other major news in the domestic markets, rating agency Fitch revised the outlook of a no. of major Indian banks including SBI, PNB, Bank of Baroda, Canara Bank, IDBI Bank, ICICI Bank, Axis Bank, EXIM Bank of India among others.

In the global space, the major US Federal Reserve meeting ended yesterday wherein the Central bank kept its interest rates on hold and extend its so called Bond buying program named Operation Twist towards the end of this year. The Fed said it will prolong the program and expects to sell $267 Billion of shorter-term securities and buying the same amount of longer- term debt in a bid to cut borrowing costs and spur thee economy. Both the moves were widely anticipated by thee markets and couldn’t spur any kind of positivism.

Today technically the Spot USD/INR is at a standpoint of either breaking the resistance of 56.42 therefore marking a new highh towards 57.00 levels, or holding those levels that would be only be possible for a string of positive data’s to tests its intraday low of 56.10 and even though this level would be considered for initiating a buy we would recommend to ponder on the European & US equity markets that would break the levels of 56.10 to test lower levels of 55.80 to 55.70.

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Nifty & USD/INR Report- 19th June. 2012

Daily Nifty Analysis

Nifty Analysis_19.06.2012_xDirect India

The ongoing worries of Spain that pushed its yield rates to over 7.25% yesterday is overshadowing the Greek elections that came out to attempt a positive vibe in the global market. However, it was soon faded as borrowings become more expensive in the Euro Zone debt ridden nations. The one domestic fundamental that could have provided the much needed support would have been the RBI monetary policy decision; nevertheless all its rates (including CRR) were kept unchanged as RBI still thinks that inflation would be the more sought out problem rather than growth for the economy. European markets too ended mixed as worries about Spain and Italy dominated investor sentiment. Italy and Spain markets closed with 3% losses, while Germany, France and UK markets ended mixed. With no major data reported yesterday, US markets closed in mixed with Dow Jones slipping 0.20% while S&P 500 and NASDAQ eking out gains of 0.14% and 0.78% respectively.

Nifty closed in the negative by 75 points at 5064 just below its support of 5065;; moreover those alone weren’t the only problems that were to be faced as FITCH lowered India’s sovereign debt rating to negative from stable.

 For today the markets could come under pressure; however it could turn out that trading would be mixed as we turn into FOMC rate decision on Wednesday and the possible reactions to it. Therefore the support levels for intraday lies in 5060 levels (Falling trend line) followed by 5012 levels (horizontal Line support). Only a breach of 5044 levels could trigger another bearish trend for the Nifty to test 4954 levels (61.80% retracement). Resistance at 5082-5090 levels (50% retracement) followed by 5120 levels.

View on Indian Rupee

USD/INR Analysis_19.06.2012_xDirect India

The Indian Rupee slipped to its lowest levels in almost a week on Monday after the domestic central bank kept the benchmark interest rates unchanged, while Fitch downgrade of country’s outlook and late session cues from the European markets also hurting sentiment. The partially convertible Rupee fell to as low as 56.04 to the USD in the latter half taking domestic and global cues while closed at 55.9050 against the US Dollar as compared to Friday’s finish at 55.39.

Weakness in the local shares to contributed to the weakness in the INR. Indian shares dropped more than 1.4% marking their biggest percentage fall since June 1, led by a sell-off in Banking and financial sector after the central bank unexpectedly kept interest rates on hold. The RBI in its monetary policy review cited its continued concerns about inflationary pressures and weakening domestic fundamentals for no change in rates.

The home currency is expected to open lower on Tuesday tracking weakness in the Asian markets and after the EURUSD fell sharply against the day’s high at 1.2750 levels yesterday. Today morning, the common currency is trading with marginal gains which might provide some support to the local unit, though overall trend seems to be weak.

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Nifty & USD/INR Report – 15th June, 2012

Daily Nifty Analysis

Nifty Analysis_15.06.2012_xDirect India

Indian markets dropped over 1% on Thursday on concern the higher than expected inflation will reduce possibility of aggressive monetary easing by the RBI on June 18. The WPI inflation for the month of May rose to 7.55% as against the previous month`s figure of 7.23% and previous year`s corresponding month`s figure of 9.56%. Moreover the March inflation was revised upwards from 6.89% provisional to 7.69%. Weak European markets further intensified the selling pressure. At the close, the benchmark 30-share index, BSE Sensex declined 202.63 points or 1.20% at 16,677.88 with 26 components posting drop. Meanwhile, the broad based NSE Nifty went down by 66.70 points or 1.30% at 5,054.75 with 44 components posting drop. Market is expected to open on positive note and likely to remain range bound ahead of Greece election on Sunday. More Americans applied for jobless benefits and consumer prices dropped by the most in three years, giving the Federa Reserve room to spur an economy that’s generating little growth or inflation. Claims for unemployment insurance payments unexpectedly climbed by 6,000 to 386,000 in the week ended June 9, Laborr Department figures showed in Washington.

Outlook for today Nifty has an immediate resistance at 5,090-5,100 levels; on a decisive close above expect rise to 5,140 & 5,180 levels. However with early Asian markets in the positive we expect the markets too would perform in a likewise manner moreover with INR appreciating would give out further confidence to the Indian equity overall. We therefore would like to initiate a buy at 5082 (former resistance and now support) for the target of 5150 levels. Stop Loss to be placed at 5045 (previous session low).

View on Indian Rupee

USD/INR Analysis_ 15.06.2012_xDirect India

The Indian rupee gains v/s the US dollar on Friday on the back of firm move in the domestic share market. On Friday, the rupee suffered from falls in global risk assets on the back of the lack of clarity on potential U.S. monetary stimulus, worries China will post weak data on Saturday, and concerns about Spanish banking woes.
Today, the sentiment is positive in the global market with stock markets, the euro and oil rallied after less bad Chinese data then expected along with a Spain’s bank bailout. The market welcomed the weekend news that Spain secured a EUR100 billion ($125 billion) loan to bolster its banking system, which makes the country the fourth and largest Euro Zone economy to be rescued by its euro-zone partners.
On Saturday, China released economic data which showed a weakening economy, but was not as bad as some expected. The PBoC made a surprise cut to interest rates ahead of the data, which was taken as a signal by the market that May’s figures were going to be very bad. As per data, China’s trade surplus was $18.7bn in May, a touch bigger than its $18.4bn surplus in April. Industrial production nudged up to a 9.6 per cent rise from 9.3 per cent in April. Inflation receded to 3.0 per cent year-on-year in May, the lowest in two years and down from 3.4 per cent in April. Today, the Japan’s Nikkei climbed 2% and Hong Kong’s Hang Seng Index gained 2.1% and Korea’s Kospi was 1.7% higher. Singapore’s Strait Times Index rose 1.5% and the China Shanghai Composite was up 0.3%.

Immediate support is at 55.30 and 55.10 levels. Intraday resistance is at 55.43 and then at 55.55 levels. Any pullback towards the resistance is ideal for selling.

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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.

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Nifty & USD/INR Report, 11th June, 2012

Daily Nifty Analysis

Nifty Analysis_11.06.2012_xDirect India

The downside on the Indian equity markets was capped and moreover also sentiments in the global markets aided the Nifty to end the week on a higher note, wherever an upside was witnessed to its biggest levels since March end-April beginning week.  Investors in the equity market seem to discount the factors of a rate cut by the RBI, which was also coupled with solid gains on the infrastructure sectors as PM meets other cabinet ministers to plan out an action initiating developments in infra region.
The 30-share index, Sensex surged 753.71 points, or 4.72% to 16,718.87 for the week ended June 8, 2012. On the other hand, the broad based NSE Nifty added 226.75 points, or 4.68%, to 5,068.35 during the week.
The Friday’s close ended the price action over and above the 5070 mark, which has now aided the price to open gap-up on the back of strong export figures and revived improved levels in imports, which has lifted market sentiments that world’s largest consumer has regained composure. Moreover the conference call among Euro Zone Finance Ministers also decided to provide bailout package to Spanish Banks.

Today we expect the positive note continue furthermore on the back of a follow through on the positive news from China and Euro Zone. Opening above 5084 mark (50% retracement) would now turn out as its support levels followed by 5060- 5070. The price action is poised to touch 5150 levels in today’s session followed by 5178 (Horizontal line resistance)

View on Indian Rupee

USD/INR Analysis_11.06.2012_xDirect India

The Indian rupee lost v/s the US dollar on Friday despite firm move in the domestic share market. On Friday, the rupee suffered from falls in global risk assets on the back of the lackk of clarity on potential U.S. monetary stimulus, worries China will post weak data on Saturday, and concerns about Spanish banking woes.
Today, the sentiment is positive in the global market with stock markets, the euro and oil rallied after less bad Chinese data then expected along with a Spain’s bank bailout. The market welcomed the weekend news that Spain secured a EUR100 billion ($125 billion) loan to bolster its banking system, which makes the country the fourth and largest Euro Zone economy to be rescued by its euro-zone partners.
On Saturday, China released economic data which showed a weakening economy, but was not as bad as some expected. The PBoC made a surprise cut to interest rates ahead of the data, which was taken as a signal by the market that May’s figures were going to be very bad. As per data, China’s trade surplus was $18.7bn in May, a touch bigger than its $18.4bn surplus in April. Industrial production nudged up to a 9.6 per cent rise from 9.3 per cent in April. Inflation receded to 3.0 per cent year-on on-year in May, the lowest in two years and down from 3.4 per cent in April. Today, the Japan’s Nikkei climbed 2% and Hong Kong’s Hang Seng Index gained 2.1% and Korea’s Kospi was 1.7% higher. Singapore’s Strait Times Index rose 1.5% and the China Shanghai Composite was up 0.3%.

Immediate support is at 55.30 and 55.10 levels. Intraday resistance is at 55.43 and then at 55.55 levels. Any pullback towards the resistance is ideal for selling.

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Nifty & USD/INR Report – 8th June, 2012

Daily Nifty Analysis

Nifty Analysis_08.06.2012_xDirect India

Markets continued inspiring from risen hope of policy rate cut and positive market sentiments after PM Dr. Manmohan Singh announced a big push to the infrastructure development in the country. European and Asian markets were up too over the speculation that Central Bank will respond with stimulus measures to resolve the crisis in Spanish banks. Asian markets were positive on the expectations that China will cut key policy rates to ease growth. Overall, the world equity markets witnessed a good rally. Interest sensitive sectors – banks, infra, auto, real estate etc performed well on the expectation of rate cut in the monetary policy to be announced on June 18, 2012.

The Nifty has managed to sustain & close above the 5,000-5,020 levels which are still signifying a bullish signal. The index has strong support at 5,000 levels on the downside. There is an immediate resistance at 5,060 levels on the upside and on a close above expect rise to 5,120 & 5,140 levels. Downside support of 4978 levels (low of June 7th, 2012) should be tested if bearish trend persists 4954.2 (61.8% retracement).

However considering the equity markets will take cues from the ongoing sentiments of the global indices that has diverted towards downhill after US Federal Reserve Chairman remained silent and still resilient on increasing further stimulus in the market.

View on Indian Rupee

USD/INR Analysis_08/06.2012_xDirect India

The Indian Rupee moved above the key 55 barrier late Thursday, hitting its strongest level in more than two weeks against the Greenback, better than expected bond auctions by Spain and France, healthy gains in the domestic stock markets and rate cut in China in late trade boosted revival in global risk sentiment. The home currency stepped up to 54.94 against the USD as compared to Wednesday’s close of 55.36. Earlier during the day it hit a high of 54.92, its strongest level since May 28.

Indian Rupee Intraday Outlook:

The Indian Rupee is expected to open with moderate losses on Friday as weakness in the Asian stocks after Bernanke comments appended by the drop in the EURUSD would impute a bearish sentiment while trading in the local currency.

The  resistance  at  55.25  (at  23.6% retracement) is witnessed following a breach would push it towards 55.40 and 55.72 levels. Support at 55.02 would be well kept; however if global markets would once again resume their risk appetite trends then lower end of the bullish channel would be tested in at 54.75.

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Nifty & USD/INR Report – 7th June, 2012

Daily Nifty Analysis

 India’s benchmark indices rose 2.7% on Wed, posting their biggest daily percentage gain since early January 2012 that was boosted by hopes of a rate cut by the RBI. Expectations that the ECB will announce more stimulus measures to resolve Euro Zone’s financial problems also contributed to the gains in global markets.

Market has moved upp in the expectation of policy actions both at India and International levels. We anticipate market may test resistance at around 5050-5075 and will need actual policy actions from various governments to cross this level.
Market  sentiments  were  positive on  the announcement from the European Central Bank issuing a schedule for an additional long term refinancing operation (LTRO) as insurance against further flight of banks accounts in Europe. Rising hope of policy rate cut by RBI, expected positive outcome from upcoming realty and construction sector also moved on the back of cuts in rates from the RBI.

Nifty has breached the resistance of 4965 levels, where decisively it portrays a bullish pattern. Only a further trigger should bee provided from various governments in order for a clean upside rally in the equity markets. Index is likely to cross 5,000 mark to test levels at 5,060 followed by 5,120 levels. As positions on net buyers have increased the support of 4960 should be labeled as an opportunity to go long, a break of which 4938 should be held as intraday support. Nevertheless the breach of the same should negate the bullish sentiments across the market.

View On Indian Rupee

USD/INR_07.06.2012_xDirect India

The Indian Rupee advanced for the third straight session against the Greenback led by improving risk appetite amidst increasing hopes of stimulus from larger economies. Gains in the domestic stock markets too aided the strength in the local currency which has been able to stay well above the record low of 56.52 hit on last Thursday.

Yesterday, the partially convertible Rupee ended at 55.36 to the USD after trading in a range between 55.61 on the upside to 55.15 on the downside and ended the day at 55.35.
The Indian Rupee is expected to trade positively today, tracking the strong gains in the Asian stocks and the uptick in the Euro which pushing the Dollar index lower. Nevertheless a rate cut from RBI should actually pave for depreciation in Indian Rupee; however as equity markets rally’s across the board the depreciation would be negated by boosting the strength in the Indian Rupee.

As London session begins we expect a further upside in the Indian rupee, where the USDINR would be poised to test the lower end of the bull trend channel at 54.80 levels and only a breach and close below it should provide leeway for 54.35 levels (horizontal line support coupled with June1st low). On the resistance front, yesterday’s high of 55.61 should negate the downside in the pair and should be considered as intraday upper resistance.

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Nifty & USD/INR Report 6th June, 2012

Daily Nifty Analysis

Nifty Analysis_06.06.2012_xDirect India

The Indian equity markets ended flat however the bias on the same remained on the positive bias as the speculation of quantitative easing made spillovers onto the Asian markets. The robust data on ISM figures even from the US actually made a drastic recovery towards the upside which gave enough boost to the equity markets. At the close, the benchmark 30-share index, BSE Sensex gained 32.24 points or 0.20% at 16,020.64 with 188 components registering rise. Meanwhile, the broad based NSE Nifty climbed by 15.15 points or 0.31% at 4,863.30 with 30 components posting rise.
The Indian markets are likely to remain choppy as European concerns bloats up with concerns of Greece still looming in and where Moody’s downgrading German banks ahead of the EU Summit is also weighing more on the bearish front.
Nevertheless, the rally could be seen another opportunity to go on the sell-side, as there’s absence of any sort of triggers for further flow into the market. Before the RBI meet the rally towards   4800-4900 could be  a  good opportunity for another round of selling bout.

View on Indian Rupee

USD/INR Report_06.06.2012_xDirect India

The Indian Rupee once again witnessed a volatile trading session with the currency opening in the positive territory though couldn’t managed to hold on to its early gains. The home currency rise in the early part of the trading session was led by speculation the central bank will lower borrowing costs in its forthcoming monetary policy meeting, reducing the rate for the second time in 2012 to support economic growth. At the end of the day,, the INR finished at 55.64 at the spot market against Monday’s close of 55.66. The Indian stock markets too followed a similar trend wherein they opened with healthy gains tracking, however gave away most of the gains to finish modestly in the green. The BSE Sensex and the NSE Nifty both were higher by around 0.2% at close.

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