If we look at the USDINR chart there is a falling wedge formation which is in more cases than not a bullish reversal signal. Wedge trend line support is at 61.00 and resistance is at 62.11. Though we traded up to 61.00 we saw a sharp reversal in yesterday’s move. A similar pattern is to be seen in EURINR chart. USDSGD is near crucial 1.2400 levels.
Interestingly, the USDINR forwards chart is also indicating further upside (both annualized and absolute figures). We see a major support at 440 ps on the 1Y forwards. This is further corroborated by higher than expected inflation wpi and cpi inflation data.
USD 5Y swaps are at major support level of 1.50%. With UST's 5Y and 10Y trading at 1.42% and 2.69% respectively for the past few trading sessions.
We may either break lower from here or see a reversal ... My sense is that we may see a reversal going ahead..We’ll have to be patient, let the factors play out and watch. So interesting times lay ahead...
(Really short on time, will look at the EM currencies space, USDINR vols, Sensex , DXY, commodities and update to see if a similar pattern is playing out)
Interesting stuff :)... Do write more....
ReplyDelete