FX Market Insight
USD/INR Spot reference {76.67}
Yesterday, USD/INR had a sharp gap down opening at 76.1600 levels against previous day close of 76.4125. After opening we saw continuous selling in the first half of the trading session which gradually dragged the pair to a low of 76.00 levels. The pair then traded higher during the later part of the day tracking retracement in dollar index after sharp lower move overnight and dollar demand by oil companies near strong physiological support at 76.00 areas. During the day the pair was trading both ways, touched a high of 76.30 levels and closed near high at 76.35 areas.
Broad Market Snapshot:
Dow Jones plunged 3.12 % and Nasdaq booked their worst daily drops -4.99% since 2020 giving back all the gains made in the prior session. E-commerce stocks were a key source of weakness due disappointing quarterly earnings reports. Market fears that Powell might have been too dovish on the short-term pace of interest rate hikes over the next few months. The fear is the FED is falling behind on inflation pressures, and will be more draconian in the future.
USD/INR Price Action and Technicals
Since last one month the pair is trading between 76.00 – 76.75 levels break of this range may trigger wild movement of 40-50 paisa any side. Cluster of strong resistances bunched together in the 76.70-76.75 region. Intraday next immediate resistance near 76.8300 is expected to cap upticks. Staying below 76.75 resistances would increase the chance to drift downward towards 76.53 areas. Such a move could improve the scope for further dip towards 76.41 levels.
Range for the day: 76.5300 to 76.8300
Equity Insights
Indian Equity
The Indian stock market is expected to begin in the red, with the wider index in India gapping down by 256 points, according to SGX Nifty trends.
The BSE Sensex advanced 33 points to 55,702, while the Nifty50 index declined from 16,950 to 16,683 and formed a bearish candle on the daily charts.
Supports towards 16,450 followed by 16,200 levels in Nifty and resistance at 16600 and 16800
Other Equity
After an overnight loss on Wall Street drove the Dow Jones Industrial Average to its worst day since 2020, Asian stocks fell sharply in the Friday morning session.
The Hang Seng index in Hong Kong, which plummeted 2.45 percent, led to regional losses. The Shanghai Composite fell 1.41 percent, while the Shenzhen Component fell 1.728 percent in mainland China.
The Nikkei 225 index in Japan fell 0.13 percent. The Topix index increased by 0.34 percent. After being closed for the majority of this week for holidays, Japanese equities resumed trading on Friday.
The Kospi index in South Korea fell by 1.48 percent. The Australian S&P/ASX 200 index fell 2.49 percent, while Singapore’s Straits Times index fell 1.35 percent.
Outside of Japan, MSCI’s broadest index of Asia-Pacific stocks fell 2.22 percent.
Commodity Insights
OIL
Oil prices fell at the start of Asian trading on Friday, as fears of an economic slowdown dampening demand for petroleum competed with anxieties about additional European Union penalties against Russia, including a crude oil embargo.
Brent futures had down 37 cents, or 0.3 percent, to $110.53 a barrel, while WTI crude in the United States had dropped 33 cents, or 0.3 percent, to $107.93 a barrel.
| Economic Calendar | ||||
| Friday, May 06, 2022 | ||||
| Time | Country | Event | Forecast | Previous |
| 14:00 | GBP | Construction PMI (Apr) | 58.0 | 59.1 |
| 18:00 | CAD | Employment Change (Apr) | 55.0K | 72.5K |
| 18:00 | USD | Unemployment Rate (Apr) | 3.5% | 3.6% |
| 18:00 | USD | Nonfarm Payrolls (Apr) | 391K | 431K |
| 19:30 | CAD | Ivey PMI (Apr) | 60.0 | 74.2 |
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Disclaimer: All information in this report is collected from various sites on the internet. Although we have taken all precautions for the correct representation of data however we do not take any responsibility for any errors and omissions. The technical analysis and views expressed are the author’s own views. We are not responsible for any losses on account of following the same.
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