ICICI Direct expect the US dollar index advanced 0.26% on Tuesday amid better than expected trade balance data from US and rise in US 10 year treasury yields.
Manoj Tulsian
February 09, 2022 / 10:18 AM IST
Representative image
ICICI Direct’s currency report on EURINR
The US dollar index advanced 0.26% on Tuesday amid better than expected trade balance data from US and rise in US 10 year treasury yields. US Treasury yields hit a more than two year high on expectation of aggressive monetary policy tightening from the US Fed to tame the elevated inflation. Rupee February futures depreciated by 0.03% on the back of strong dollar and FII outflows. However, muted crude oil prices prevented further decline in the Indian currency. The rupee is likely to appreciate today mainly due to optimistic sentiments in the global markets and softer crude oil prices. However, sharp gains may be prevented as investors will remain cautious ahead of Monetary policy decision from RBI. US$ INR (February) is likely to correct further towards 74.60 levels.
The Euro depreciated by 0.19% on the back of uptick in dollar. However, improved risk appetite in the global markets and surge in Germany 10 year treasury yields prevented further decline in the single currency. The Euro is likely to trade with a negative bias on the back of surge in the dollar and expectations of disappointing economic data from Euro Area. However, risk in risk appetite in the European markets may provide some support to the Euro on lower side. The EURINR (February) is facing strong resistance at 85.90 levels. As long as they sustain below this level, EURINR is likely to correct further towards 85.20 levels for the day. The pound appreciated by 0.10% amid surge in UK 10 year treasury yields and optimistic sentiments in the UK markets. Further, improved BRG retails sales monitor data from UK lifted Sterling. However, a sharp upside was capped on stronger dollar and concerns over political crisis in the British government.
Intra-day strategy
| EURINR February futures contract (NSE) | |
| Sell EURINR in the range of 85.55-85.57 | |
| Target: 85.20 | Stop Loss: 85.70 |
| Support: 85.20/85.00 | Resistance: 85.70/85.90 |
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Manoj Tulsian , Wholetime Director & CFO, JMC Projects
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