Currency Outlook –Event for the day BOE Gov Carney Speaks
Dollar/rupee traded down for the
fourth-straight session on likely FII inflows into local stocks on hopes of
passing GST Bill in the monsoon parliamentary session and tracking good
progress in the monsoon.
Technical, USDINR continued its recent
bearish move for sixth consecutive day. However after hitting a low of 67.3925,
pair saw small recovery and settled at 67.50, down by 0.16%.
Intraday price action result in
formation of hammer candle stick which is indicating for bearish reversal, but
there is massive resistance at 67.60 and pair would need to trade above 67.60
in order to give upside move towards 67.78-68.00, else correction will expect
to continue towards 67.25-67.00.
Dollar index were little changed from
previous day on lack of fresh triggers on back US financial and commodity
markets remaining closed for Independence Day celebration.
Meanwhile, China Caixin services purchasing
managers' index (PMI) climbed to 52.7 from 51.2 in May, marking the fastest
increase in 11 months. Levels above 50 indicate expansion, while levels below
signal contraction.
However Japan's Services sector as indicated
by Markit/Nikkei PMI activity contracted to 49.4 in June from 50.4 in May as
new business shrinks.
The Chinese yuan slipped as low as 6.6702
Tuesday, its weakest against the US dollar since December 2010, after the
People's Bank of China set the currency's daily benchmark 0.2% weaker.
The yuan traded to a more-than-five-year low
even as stocks in Shanghai rallied 0.6%. The weakening of the yuan's daily
parity rate was slightly surprising, given the overnight drop of the ICE US
dollar index and strengthening of the Australia dollar.
The surprisingly weaker fixing may drive
fears of currency depreciation as a policy stance by China's central bank.
Though the PBOC has denied such an agenda, it
wouldn't be the only global central bank seeking ways to counteract a slowing
economy. USD/CNY is
now 6.6692 from its Monday closing of 6.6636, representing a 0.1% depreciation
of the yuan versus the U.S. dollar. (tickernews)
EUR-INR July Future
Euro rebounded from day's low after producer
prices rose most in 16 months indicating that the common currency area may have
been in the process of recovery before the Brexit event.
EURINR failed to close below the previous
swing low and after hitting a low of 74.9150, settled at 75.11
levels. Intraday
price action resulted in formation of high wave candle stick pattern which is
indicating for indecisive trend in days to come. .
Near
term resistance is seen at 75.40 and possible correction is expected to come on
rise around 75.10-75.20 unless it gives a closing above this resistance. Target
74.80-74.60.
GBP-INR July Future
Pound fell during early European trade Monday
following disappointing economic data from the United Kingdom amid concerns
about economic growth following Brexit.
GBPINR extended its recent bearish move and
settled down by 0.44% at 89.6225 levels. Sell strategy given below 89.74 was
initiated but yet to test predicted level of 89.40-89.20.
Near term outlook is looking bearish
following to the breakdown of its previous swing low, and any rise towards
89.70-89.80 is expect to attract near term selling activities
JPY-INR July Future
Yen snapped three-day gains Monday on
uncertainty ahead of extended weekend in the US as financial markets in U.S.
will remain closed for independence day on Jul 4.
After hitting a low of 65.58, JPYINR
rebounded towards 65.7850 and settled at 65.7550. Pair well managed to trade
above its short term moving average which giving momentum buying signal for the
target 66.00-66.20.
On the downside massive support is seen
at 65.50 and sustain trade below only will expect to test 65.00-64.80.
Major Economic Data & Events Schedule today
|
Time
|
Currency
|
Economic Indicators
|
Forecast
|
Previous
|
Possible Impact
|
|
7:15am
|
CNY
|
Caixin Services PMI
|
52.3
|
51.2
|
Positive
|
|
9:15am
|
JPY
|
10-y Bond Auction
|
-
|
-0.09|4.1
|
-
|
|
12:45pm
|
EUR
|
Spanish Services PMI
|
55.2
|
55.4
|
Negative
|
|
1:15pm
|
EUR
|
Italian Services PMI
|
50.3
|
49.8
|
Positive
|
|
1:20pm
|
EUR
|
French Final Services PMI
|
49.9
|
49.9
|
Neutral
|
|
1:25pm
|
EUR
|
German Final Services PMI
|
53.2
|
53.2
|
Neutral
|
|
1:30pm
|
EUR
|
Final Services PMI
|
52.5
|
52.4
|
Positive
|
|
2:00pm
|
GBP
|
Services PMI
|
53.1
|
53.5
|
Negative
|
|
2:30pm
|
EUR
|
Retail Sales m/m
|
0.60%
|
0.00%
|
Positive
|
|
3:00pm
|
GBP
|
BOE Financial Stability Report
|
-
|
-
|
-
|
|
3:30pm
|
GBP
|
BOE Gov Carney Speaks
|
-
|
-
|
-
|
|
7:30pm
|
USD
|
Factory Orders m/m
|
-0.70%
|
1.90%
|
Negative
|
|
USD
|
IBD/TIPP Economic Optimism
|
49.3
|
48.2
|
Positive
|
Impact: High Low Medium
