HSL PCG CURRENCY DAILY

06 January, 2017

PRIVATE CLIENT GROUP [PCG]

 VIEW POINT
STRATEGY FOR THE DAY Rupee Strengthens on Weaker Dollar and Greater Hope from
Budget
JPYINR JAN. FUT. : Yesterday, Rupee strengthened for the second session against the
BUY ARND 58.55 SL 58.30 TGT 58.90 US dollar on the expectation that the government may achieve its
fiscal deficit target after finance minister Arun Jaitley said the tax
collection will exceed budget estimates. Besides weaker dollar
MAJOR CURRENCY against major currencies, the expectation good budget also boost
the sentiment for rupee. The rupee closed at 67.96 per dollar, up
Prev. 0.12% from its previous close of 68.05. The 10-year bond yield
Close Chg. % Chg.
Close closed at 6.387%, compared to Wednesday's close of 6.382%.
USDINR 67.961 68.045 -0.084 -0.12% The one month forward USDINR NDF quoting at 68.04 from previous
DXY INDX 101.560 101.520 0.040 0.04% 68.14 indicating weaker opening at domestic bourses. Technically,
EURUSD 1.059 1.061 -0.002 -0.18% spot USDINR is having support at 67.70. The bias for the pair
GBPUSD 1.240 1.242 -0.002 -0.19% remains bearish in near term with sell on rally .
USDJPY 115.810 115.350 0.460 0.40% Dollars Trump Rally Pauses
DG USDINR 67.879 67.879 0.000 0.00% Dollar starts 2017 on a weak note after minutes of the Federal
Reserves last policy meeting were seen as less hawkish than
GLOBAL INDICES expected due to uncertainty around its projections amid Donald
Trumps fiscal agenda.
Prev. Trader winding or profit booking bullish dollar trades as it might not
Close Chg. % Chg.
Close be favorable game as it requires US to consistently produce better
SGX NIFTY 8310.0 8290.0 20 0.24% than expected economic number, while Trump must deliver on his
NIFTY 8273.8 8190.5 83 1.02% promise. Fed minutes show discussion on downside risks stemming
from a stronger U.S. dollar and slower growth abroad.
SENSEX 26878.2 26633.1 245 0.92%
HANG-SENG 22554.6 22456.7 98 0.44% Today, the dollar seesaw at three-week lows against a basket of
currencies after it suffered a swift evaporation of bullish momentum
NIKKEI 19442.2 19520.7 -79 -0.40%
in the wake of a jump in the Chinese yuan. China is expected to
SHANGHAI 3159.6 3165.4 -6 -0.18% report December and full-year 2016 foreign exchange reserves on
S&P INDEX 2269.0 2270.8 -2 -0.08% Saturday amid concern over the speed at which it is burning through
DOW JONES 19899.3 19942.2 -43 -0.21% its dollar cash pile in defence of the yuan.
NASDAQ 5487.9 5477.0 11 0.20% The dollar index was little changed near 101.300, its lowest since
FTSE 7195.3 7189.7 6 0.08% Dec. 14. It was on track to lose 0.8% on the week. Technically, the
CAC 4900.6 4899.4 1 0.03% buck continue to get resisted around 103.80 while find support
DAX 11584.9 11584.3 1 0.01% around 100 marks.

PRIVATE CLIENT GROUP [PCG]

 TECHNICAL OUTLOOK
SPOT USDINR HOURLY CHART

Technical Observations

It was a volatile day for the currency market, as big swing trade seen during the day trade. Spot USDINR started the day on weak
note and headed in first half of the trade however latter recovered from the low of 67.75 and closed at 67.96 with small loss of 8
paise. On hourly chart, the pair remained below middle band of the Bollinger band after initially touching lower band.
Momentum oscillators on hourly exited from oversold zone while on daily chart still heading lower with negative divergence
indicating sell on rally.
Shot term bias turned neutral to bearish till the pair surpasses level of 68.37 while find support near 67.72.

PRIVATE CLIENT GROUP [PCG]

TECHNICAL LEVELS

Contracts Last Pivot S3 S2 S1 R1 R2 R3 View For The Day

USDINR JAN17 68.11 68.06 67.60 67.74 67.93 68.25 68.39 68.57 Long Liquidation
EURINR JAN17 71.54 71.64 71.05 71.28 71.41 71.77 72.00 72.13 Short Covering
GBPINR JAN17 83.88 83.83 83.16 83.37 83.63 84.09 84.30 84.55 Long Buildup
JPYINR JAN17 58.47 58.57 57.91 58.16 58.32 58.72 58.97 59.13 Short Covering

Wkly Wkly 1-Mth. 1-Mth. 52 Wk 52 Wk

Spot 5 DMA 20 DMA 50 DMA 100 DMA 200 DMA
High Low High Low High Low
USDINR 68.25 67.72 68.80 67.33 68.86 66.07 68.10 67.88 67.71 67.26 67.11
EURINR 71.90 70.72 73.35 70.42 77.49 70.42 71.29 71.20 72.30 73.48 74.31
GBPINR 83.91 83.09 86.88 83.07 100.49 80.89 83.67 84.08 84.18 85.01 89.13
JPYINR 58.59 57.72 61.50 57.25 68.11 55.73 58.04 58.02 60.41 62.83 62.96

CURRENCY MOVEMENT
Open Chg. in Chg. in
Currency Open High Low Close Chg. Volume
Interest OI Volume
SPOT USDINR 67.90 68.00 67.75 67.96 -0.08 -- -- -- --
USDINR JAN. FUT. 68.20 68.20 67.88 68.11 -0.11 1724160 97694 1332475 433375
SPOT EURINR 71.47 71.69 71.27 71.31 0.27 -- -- -- --
EURINR JAN. FUT. 71.60 71.87 71.51 71.54 0.19 32187 -6543 64881 30265
SPOT GBPINR 83.90 83.90 83.32 83.65 0.20 -- -- -- --
GBPINR JAN. FUT. 83.90 84.04 83.58 83.88 0.13 27630 395 64783 29594
SPOT JPYINR 58.33 58.63 58.20 58.29 0.39 -- -- -- --
JPYINR JAN. FUT. 58.45 58.82 58.41 58.47 0.27 31260 -2427 54820 28351

PRIVATE CLIENT GROUP [PCG]

 ECONOMIC EVENTS RELEASED
Date Time Country Event Period Survey Actual Prior

01/05/2017 15:00 UK Markit/CIPS UK Services PMI Dec 54.7 56.2 55.2

01/05/2017 15:30 EC PPI YoY Nov -0.10% 0.10% -0.40%
01/05/2017 18:45 US ADP Employment Change Dec 175k 153K 216k
01/05/2017 19:00 US Initial Jobless Claims 31-Dec 260k 235K 265k
01/05/2017 19:00 US Continuing Claims 24-Dec 2051k 2112K 2102k
01/05/2017 20:15 US Markit US Services PMI Dec F 53.4 53.9 53.4
01/05/2017 20:30 US ISM Non-Mfg. Composite Dec 56.7 57.2 57.2

ECONOMIC EVENTS RELEASED

Date Time Country Event Period Survey Prior

01/06/2017 15:30 EC Consumer Confidence Dec F -5.3 -5.1
01/06/2017 15:30 EC Retail Sales YoY Nov 1.90% 2.40%
01/06/2017 17:30 IN GDP Annual Estimate YoY 1Q A -- 7.60%
01/06/2017 19:00 US Trade Balance Nov -$42.8b -$42.6b
01/06/2017 19:00 US Change in Nonfarm Payrolls Dec 178k 178k
01/06/2017 19:00 US Unemployment Rate Dec 4.70% 4.60%
01/06/2017 20:30 US Factory Orders Nov -2.30% 2.70%
01/06/2017 20:30 US Durable Goods Orders Nov F -4.60% -4.60%

PRIVATE CLIENT GROUP [PCG]

 Technical Analyst: Vinay Rajani (vinay.rajani@hdfcsec.com)
Currency Analyst: Dilip Parmar(dilip.parmar@hdfcsec.com)

HDFC securities Limited, I Think Techno Campus, Building - B, "Alpha", Office Floor 8, Near Kanjurmarg Station, Opp. Crompton Greaves, Kanjurmarg (East), Mumbai 400 042
HDFC securities Limited, 4th Floor, Astral Tower, Above HDFC Bank Ltd, Nr.Mithakhali Six Roads, Navrangpura, Ahmedabad 380009.
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Disclosure:

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PRIVATE CLIENT GROUP [PCG]