ICICI direct believes that USDINR should consolidate around 72.50 while upsides can be used as shorting opportunity once again.
Indian rupee opened higher by 14 paise at 72.36 per dollar on Tuesday against previous close of 72.50, amid buying seen in the domestic equity market.
On February 22, the domestic unit ended higher by 15 paise at 72.50 per dollar versus Thursday’s close of 72.65.
At 10:07 IST, the Sensex was up 206.91 points or 0.42% at 49,951.23, and the Nifty was up 69.50 points or 0.47% at 14,745.20.
Oil prices rose again on Tuesday after a jump in the previous session, holding near a more than 13-month high as U.S. output was slow to return after a deep freeze in Texas shut in crude production last week.
The dollar nursed losses near a six-week low on Tuesday while commodity currencies loitered around multi-year highs, as investors’ focus shifted to how U.S. Federal Reserve chief Jerome Powell might respond to resurgent inflation expectations.
Foreign institutional investors (FIIs) net sold shares worth Rs 893.25 crore, whereas domestic institutional investors (DIIs) also sold shares worth Rs 919.88 crore in the Indian equity market on February 22, as per provisional data available on the NSE.
The USDINR future continue to appreciate against the dollar and moved below our target levels of 72.50. We believe it should consolidate around these levels while upsides can be used as shorting opportunity once again, said ICICI direct.
The dollar-rupee February contract on the NSE was at Rs 72.46 in the last session. The open interest increased almost 5% in the February series, it added.