Currency Report for Exporters and Importers :16th August 2018

Insignia Consultants

New Delhi

Thursday, August 16, 2018

TIME: 9:41 am IST          

DAILY FOREX REPORT FOR EXPORTERS AND IMPORTERS

(inter-bank prices below)

There was profit taking in long US dollar positions after China said that its vice commerce minister will visit USA towards the end of the month. Turkey will be the focus for now. There can be very sharp corrections in the US dollar while maintain the overall bullish trend.

India

Indian markets should be happy that yesterday was closed. Global markets have recovered from Turkey’s faux pass. The pace of rise for the rupee (if any) will slow down. Fall in global crude oil prices is an added benefit to Indian rupee and emerging market currencies. Importers and corporates will be covering their near term payables on dips as Turkey and China have not evaporated. Short term global investors will be cautious of investing in India due to the state elections. In the NDF market rupee rose to 70.9050 against the US dollar. It could be a short term top.

US dollar-Indian Rupee (usd/inr CMP 70.1750):

One Support: 69.9775
One Resistance: 70.6700

o      Rupee can fall to 69.7650 and 69.2950 as long as it trades below 69.6750.

o      Only a break of 69.6750 will trigger a rise.

UK Pound/US dollar (gbp/usd CMP 1.2718):
One Support: 1.2651-1.2693
One Resistance: 1.2781

o      Pound can rise to 1.2781 and 1.2869 by tomorrow as long as it trades over 1.2651.

o      Another wave of sell off will be there below 1.2651.

o      Technically oversold.

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FAQ

Why Do I ask exporters and importers to use trailing stop loss? Some day’s currency markets are very volatile. Trend (short term as well as medium term) change at the flick of coin without any advance warning. In order to make the most of the volatility it is preferable to use trailing stop loss using technical analysis as basis. Those exporters and importers do not wish to take the risk, should take a forward cover or hedge in future and options market if export or import price near cost.

Disclaimer: Any opinions as to the commentary, market information, and future direction of prices of specific currencies, crypto currency, metals and commodities reflect the views of the individual analyst, In no event shall Insignia Consultants or its employees have any liability for any losses incurred in connection with any decision made, action or inaction taken by any party in reliance upon the information provided in this material; or in any delays, inaccuracies, errors in, or omissions of Information. Nothing in this article is, or should be construed as, investment advice. Prepared by Chintan Karnani