We have the reserve bank of India (RBI) quarterly review of the economy this week. A cash reserve ratio (CRR) rate cut by 0.25% has already been factored in by the markets. In our view repo rate and reverse repo rate may not be cut. In case the RBI cuts either the repo rate or the reverse repo rate then rupee will fall three percent against the major currencies in the short term. The UPA government has induced seventeen first time ministers. All I can say is that the government has sent packing the tainted ministers. They tainted ex-ministers will now clean up all the scams which they had done and the actual will never become public. New faces also implies that on the surface the UPA government will look clean when the next Lok sabha elections are held in the next eighteen months.

I just hope the new ministers are sensible to common mans needs and do try to bring down food price inflation. In India the period between November to March every year is a cyclical period where prices of vegetables and other food stuff fall cyclically. Inflation will come down over the coming months and there is a greater chance of an interest rate cut over the next two quarters.

For the short term global economy will be the key for the Indian rupee and Indian stock markets. The statistical economic numbers of USA and UK are showing signs of growth. Eurozone is stable while Japan had announced another round of stimulus measures.  If the global economy shows signs of improvement in the next three months then rupee will appreciate to 51.40 and 50.75 against the US dollar (inter-bank rates).

 

Trading strategy For the very large traders and high risk traders

  • USD/INR NOVEMBER: sell around 54.01-54.11 stop loss 54.45 for Friday.
  • EURO/INR NOVEMBER: Sell euro/inr around 70.33-70.36 stop loss 70.65 target 69.60-69.00 or sell below 69.5275 stop loss 69.8850 target 69.2875-69.9800
  • GBP/INR NOVEMBER: Sell below 86.8200 stop loss 87.1025 target 86.4975-86.2675
  • JPY/INR NOVEMBER: Sell around 67.5025 stop loss 66.7350 target 66.9675-66.6200

 

TECHNICAL VIEW

US-DOLLAR – INDIAN RUPEE (USD/INR) NOVEMBER – (CURRENT PRICE 53.9000)

Bullish over 54.1125 with 54.4275-54.7675 as price target
Bearish below 53.0100 with 53.7675 and 53.4775 as price target
Neutral Zone: 53.0100-54.1125

BREAK POINT: - 54.0100

  • Usd/inr needs to break 54.76 in November. In case Usd/inr does not break 54.7600 in November then a fall to 52.75 and 51.75 is imminent.
  • Today usd/inr can fall to 53.6875 and 53.42 as long as it trades below 54.1125

 

EURO-INDIA RUPEE (EUR/INR) NOVEMBER – (CURRENT PRICE 69.9475)

Bullish over 70.0875 with 70.2275-70.7900 as price target
Bearish below 69.8450 with 69.5475-69.3000 as price target
Neutral Zone: 69.8450-70.0875

BREAK POINT: 70.0875

  • Euro/Inr needs to trade over 70.0875 to target 70.7875 and 71.5100
  • Key weekly support is at 69.5200 and there will be a technical break down only below 69.5200.
     
     

UK POUND -INDIA RUPEE (GBP/INR) NOVEMBER – (CURRENT PRICE 86.8650)

Bullish over 86.8200 with 87.2700 and 87.5450 as price target
Bearish below 86.3675 with 86.1350 and 85.9025 as price target
Neutral Zone: 86.3675-86.8200

BREAK POINT: 86.8200

  • Key long term support is at 86.8200 and rupee needs to trade over 86.8200 to target 87.5450-88.9250
  • Only a daily close below 86.8200 for three consecutive days will result in a short term bearish trend.

 

JAPANESE YEN -INDIA RUPEE (JPY/INR) NOVEMBER – (CURRENT PRICE 67.1950)

Bullish over 66.9575 with 67.5025 and 68.2500 as price target
Bearish below 66.6850 with 66.2350 and 66.0500 as price target
Neutral Zone: 66.6850-66.9575

BREAK POINT: - 66.9575

  • Key long term support is at 66.9575 and yen needs to trade over 66.9575 to target 67.5025-68.5400
  • There will be sellers below 66.9575

Happy profitable trading & Trade without emotions