Globally,
financial markets witnessed risk-off swing after Iran launched multiple
missiles on US military bases in Iraq. Crude had initially spiked to 71.75 than
fell back to 69.30 levels and USD/JPY promptly tested 107.60 levels before recovering to 108.30. The recovery in USD/JPY can be attributed to lack of
fresh escalation in Trump’s tweet. “All is well! Missiles launched from Iran at
two military bases located in Iraq. Assessment of casualties & damages
taking place now. So far, so good! We have the most powerful and well equipped
military anywhere in the world, by far! I will be making a statement tomorrow
morning”. Given, this backdrop USD/JPY pair can be shorted at CMP 108.35 with
stop above 108.70 for first target of 107.70 and second target of 106.50.
On
domestic front, India’s GDP growth for FY 2019-20 is estimated to be at 5%
against 6.8% last year. Given lower than 5% realized growth in first half, CSO
expects economy to pick-up some steam in last quarter. On fiscal front,
Government has been pushed into a tight corner as slower growth will lead to
lower revenue realization and spending cut will put further pressure on
economy.
On currency front, Few banks have been trading outside earlier trading
window of 9 AM-5 PM, as Onshore INR becomes tradable 24 hours. USDINR currently
trading on firm footing at 72.01 tracking global riskoff sentiments. USDINR
pair has first resistance at 72.12 levels and second resistance at 72.25
levels. USDINR pair support at 71.80 levels. Range for the day seen as
71.80-72.25 with bias to buy on dips.
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