Long term (3 to 6 Months)
“
”
● Oil prices rise as producers commit to output restraint
IFA GLOBAL TREASURY RESEARCH ACADEMY| www.ifaglobal.net |
● Fed policy makers, like lawmakers, split on need for more fiscal aid
● Budget will increase rural consumption, boost economy - India Inc
Dollar hovers near seven-week
high after boost from euro
selloff
● US manufacturing activity slowed slightly in January
● Gold prices plunge as customs duty cut in Budget 2021
From CEO's Desk
Medium term (Upto 3 Months) Intraday
Note: The above outlook is based on IFA Global Research Academy Proprietary ("IFA Dollar - Rupee Sentiment Index") based on various
techno-fundamental factors relevant to the particular outlook horizon. The index weights have been arrived at after rigorous back
testing. The factors which are considered for computation of barometers includes pre-defined and back tested weightage given to
fundamental factors such as economic data, FII flows, Global equity markets, Government & RBI activity, Onshore-offshore activity, other
peer currency performance and other macro economic factors. Further, this module also considers factors such as major MPC member's
speech, meeting or summit. On the technical front, factors include indicators and oscillators such as RSI, stochastic, combination of
moving averages and other basic & advance technical studies. (0 - 20%=extremely bearish, 21% - 40%=bearish, 41% - 60%=neutral, 61% -
80%=bullish, 81% - 100% extremely bullish)
News On The Street
47% 69% 58%
Mr. Abhishek Goenka
The FM delivered an expansionary and a demand stimulating budget yesterday. While
the equity markets rejoiced, nervousness was evident in the bond markets. The fiscal
deficit at 9.5% of GDP for FY21 was much higher than estimates of 7-7.5% of GDP.
The fiscal deficit target of 6.8% for FY22 was also much higher than estimates of
around 5.2-5.5% of GDP. The return on the path to fiscal consolidation also seems
more gradual than what the markets would have anticipated with the government
looking to bring the fiscal deficit below 4.5% only by FY 2026. The Bond market got
spooked on account of the higher borrowing and sold off. The yield on the
benchmark 10y was up 14bps at 6.08%. There was in fact a parallel shift across the
curve. The 3y and 5y OIS too have got paid 15bps each. Equity markets were buoyed
by the fact that the government seemed to have got the prioritization right as far as
expenditure was concerned. An increase in share of CAPEX as part of total
expenditure was a welcome move considering the forward and backward linkages
and the multiplier impact on growth that it has. Equities staged a phenomenal rally
with the Nifty ending 4.7% higher and the Bank Nifty gaining 8.6%. Rupee to trade in
a 72.90-73.20 range.
Strategy: Exporters are advised to cover a part of their exposure on upticks to 73.80-
73.90. Importers are advised to cover through options. The 3M range for USDINR is
72.50 – 74.40 and the 6M range is 73.00 – 76.00.
IFA Dollar- Rupee Sentiment Index
“USDINR
$ INDEX
EURUSD
GBPUSD
USDJPY
AUDUSD
GOLD
”
Focus this week to
be on the BOE
Monetary Policy &
RBI Monetary Policy
1.1450-1.2000 ↑
Q1 FY 2021-22
0.7200- 0.7600
91.20- 95.50
1.3100-1.3600 ↑ 1.3400-1.4000 ↑
0.7150- 0.7650 ↑
95.00- 100.00 ↓ 95.00- 100.00 ↓
$1700- $2200 ↑
1.1600-1.2150 ↑
1.3500-1.4150 ↑
73.00 - 77.00 ↑
0.7200- 0.7600
IFA GLOBAL TREASURY RESEARCH ACADEMY| www.ifaglobal.net |
103.00 - 106.00 ↓
Q2 FY 2021-22
● EURUSD (RANGE- 1.2020 - 1.2120)
Despite the robust release of manufacturing data from the country,
Sterling plunged. Reason behind the same could be attributed to surge
in US Dollar Index. Going forward, Pound shall again bounce back
majorly due to the fast vaccination process which shall keep the
sentiments boosted. Focus to be on the BoE Policy to guage the path
of interest rates in future.
● GBPUSD (RANGE- 1.3640 - 1.3750)
IFA Outlook
Q3 FY 2021-22
FX Outlook for the day
● USDINR (RANGE - 72.90 - 73.20)
Yen weakened towards 105.05 levels as US Dollar Index move towards
north owing to sharp selling seen in Euro currency. Japanese Yen is
likely to trade in a range bound manner with a slight positive bias
tracking the positive trading in Asian equities along with the robust
release of inflation data from the nation. Slight reversal in DXY shall
add to Yen's strength.
Rupee made a flat opening at 73.02 levels and is likely to trade in a
range bound manner with a slight positive bias tracking the robust
sentiments in Asian and domestic equities. 72.75-73.50 range to
continue in Rupee until the monetary policy on Friday. However, the
RBI would continue supporting USDINR on dips. Moreover, fall in
global dollar could work in favour of the Rupee.
Euro plunged sharply yesterday pushing the DXY higher after
coronavirus lockdowns choked consumer spending in Europe’s biggest
economy. German retail sales plunged by more than forecast in
December, with the continent still struggling with vaccine rollouts.
Euro to continue with its bearish move owing to the above reasons.
DXY has erased slight gains benefitting Euro.
● USDJPY (RANGE- 104.40 - 105.00)
Q4 FY 2020-21
DAILY CURRENCY INSIGHT February 2, 2021
72.50-74.90
1.3125-1.3650 ↑
0.7150-0.7750 ↑
73.00-76.00
$1800- $2000 ↑
73.00-76.00
$1700- $2200 ↑
107.00-112.00 106.00-111.00
1.1700-1.2200 ↑
89.00 - 93.00 ↓
1.1950-1.2350 ↑
$1800- $2100 ↑
104.00-108.00 ↓
“
”
“
”
“
”
Chart of the DayUSDINR: 73.02
USDINR made a flat opening today at 73.02 levels.
Immediate resistance to be at 73.35 (Super trend). On
the flipside, 72.50 is an extremely crucial support, break
of which could trigger stops. Major technical indicators
suggest neutral view for intraday.
FIIs have so far
infused $30.29
billion in the
Financial year 2020-
21
Activity Kurtosis
IFA GLOBAL TREASURY RESEARCH ACADEMY| www.ifaglobal.net |
● FII activity against USDINR and Nifty
February 2, 2021
● USDINR Open Interest (February expiry )
DAILY CURRENCY INSIGHT
Highest OI for Call &
Put is seen at 74.00
& 73.00. Highest OI
intraday buildup for
Call is seen at 73.00
& for Put is seen at
74.00.
LIBOR ON 1M 6M 1Y MONTH 1M 3M 1Y 2Y
USD 0.08 0.11 0.22 0.31 USDINR 0.24 0.98 3.59 7.26
EUR -0.59 -0.58 -0.53 -0.51 EURINR 0.33 1.36 5.12 10.43
JPY 0.04 -0.06 -0.06 0.04 GBPINR 0.33 1.39 5.15 10.38
JPYINR 0.24 1.00 3.77 7.74
REGION LAST % CHANGE LAST CHANGE % CHANGE
ASIA 29422 1.83 1855.63 -1.44 -0.08
3524 0.55 28.39 -0.08 -0.28
28324 0.83 54.17 0.62 1.16
INDIA 49858 2.59 90.87 -0.11 -0.12
14646 2.56 109.34 0.11 0.10
5462 1.16
13622 1.41 FY 2020-21 CY 2021 1-Feb-21
6466 0.92 2,33,419 15,129 -4,344
US 30212 0.76 -22,403 -5,351 -526
13403 2.55 10,175 -20 -3
2,21,191 9,758 -4,873
“ Pivot S2 S1 P R1 R2USDINR 72.60 72.77 72.96 73.13 73.32
EURINR 87.49 87.99 88.44 88.94 89.39
GBPINR 98.73 99.37 99.88 100.52 101.03
JPYINR 68.93 69.28 69.85 70.20 70.77
”
Currency Time (IST) Actual Forecast Previous Impact
30-Jan EUR 12:30 AM -9.6% -2.0% 1.9% Bearish
GBP 3:00 PM 54.10 52.9 52.9 Bullish
USD 8:30 PM 58.7 60.0 60.7 Bearish
2-Feb GBP 12:30 PM 0.3% 0.8%
EUR 1:15 PM 0.0% 0.2%
USD 3:30 PM -0.9% 12.5%
CAC
DAX
Major Global Rates
LIBOR Rates
COMMODITIES/DIGLOBAL INDICES
Quick Glance
FPI INFLOWS
Bloomberg ADXY
GOLD ($/ounce)
Brent ($/brl)
SILVER ($/ounce)
HANG SENG
SHANGHAI
NIKKEI
SENSEX
NIFTY
February 2, 2021
Dollar INDEX
Rolling Forward Premiums (in paise)
Figures are in INR Crores
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Major Global Events
Macro Monitor
TOTAL
EQUITY
German Retail Sales MoM
ISM Manufacturing PMI
DEBT
French Prelim CPI MoM
Prelim Flash GDP QoQ
FTSE
Nationwide HPI MoM
Final Manufacturing PMI
Pivot Points
HYBRID
EURINR pair is likely to take immediate
support at 87.99 (S1)
DOW
NASDAQ
DAILY CURRENCY INSIGHT
IMPORTANT NOTICE AND DISCLAIMER
While every effort has been made to ensure that the data quoted and used for the research behind this document is reliable, there is no guarantee that it is correct, and IFA Global can accept no liability whatsoever in respect of any errors or omissions, or regarding the accuracy, completeness or reliability of the information contained herein. This document does not constitute a recommendation to sell and/or buy any financial products and is not to be considered as a solicitation and/or an offer to enter into any transaction. This document is a piece of economic research and is not intended to constitute investment advice, nor to solicit dealing in securities or in any other kind of investments. Although every investment involves some degree of risk, the risk of loss trading off-exchange forex contracts can be substantial. Therefore if you are considering trading in this market, you should be aware of the risks associated with this product so you can make an informed decision prior to investing. The material presented here is not to be construed as trading advice or strategy. IFA Global makes a strong effort to use reliable, expansive information, but we make no representation that it is accurate or complete. In addition, we have no obligation to notify you when opinions or data in this material change. Any prices stated in this report are for information purposes only and do not represent valuations for individual securities or other instruments.
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