We feel the rupee is likely to trade in range and any visible bounce towards 73.15 should be used to create short position, says ICICIdirect.
Indian rupee is trading marginally lower at 72.94 per dollar, amid volatile trade seen in the domestic equity market.
It opened flat at 72.95 per dollar against Friday’s close of 72.97.
At 11:13 IST, the Sensex was up 123.39 points or 0.25% at 49,001.93, and the Nifty was up 40.40 points or 0.28% at 14,412.30.
“The currency market is trading in a very tight range, and there is no volatility to keep it on an edge. Next week is FOMC policy and Fed will keep the easy monetary policy, keeping dollar subdued. The optimism over growth is still high but if there are delays in vaccine rollout then the immediate impact will be some upside in spot,” said Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services.
“RBI is keeping the spot near 73 zone, if that breaks the spot will fall to 72.75, while 73.50 will continue to be the resistance,” he added.
Gold prices gained on Monday as the dollar eased and hopes that a massive economic stimulus in the world’s largest economy would be passed remained intact.
Oil prices slipped for a second straight session on Monday as renewed COVID-19 lockdowns raised fresh concerns about global fuel demand.
The dollar held ground against riskier currencies on Monday as weak economic data from Europe and fresh worries about the coronavirus supported investor demand for safe-havens, stretching greenback selling positions.
USDINR pair is consolidating near its sizeable Put OI base of 73. Looking at the declining volatility, we feel the rupee is likely to trade in range and any visible bounce towards 73.15 should be used to create short position, said ICICIdirect.
The dollar-rupee January contract on the NSE was at Rs 72.96 in the last session. The open interest fell by 2.8% in the current series while February series saw an increase of over 60% in open interest, it added.