Long-term view for the currency has not been altered despite the 5 per cent depreciation in rupee over the last ten sessions. We expect a movement between Rs 39 and Rs 43 for a few months as the currency corrects the entire down-move recorded since May 2002. However, a move past Rs 43 would imply that the up-move can extend to Rs 45.
The USD-INR currency pair has achieved the target for the third leg of the move from January trough that is Rs 42.06. An extension of this wave would give the next target at Rs 42.62. However, it needs to be borne in mind that the currency pair is currently close to significant medium and long-term resistance levels. There is a confluence of targets in the band between Rs 42 and 43 from where a medium term reversal can take place. A reversal from these levels can pull the currency pair back towards Rs 40.
The dollar-rupee pair outdid our near term expectation to record a peak at Rs 42.2 on Tuesday. A five-wave move is nearing completion from the Rs 39.6 trough. The near term targets for this move are Rs 42.35 or Rs 42.5. An extension can pull the currency pair towards Rs 42.87.
However, a sideways move between Rs 41.5 and Rs 42.5 is quite likely for a few sessions. A close below Rs 41.1 is needed to negate the positive near term outlook.
Supports – 41.25, 41.10, 40.85
Resistances – 42.55, 42.78, 42.95
2 comments:
wow that is cool
so the U.S dollar equals nearly 43 rupees right ?
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