TRADERS´ Blogs

The rupee declined to 54.88 against the dollar on mild capital outflows and a weaker euro. The Indian unit opened marginally higher at 54.76 from yesterday’s close of 54.78 to the dollar on positive domestic and Asian equity markets. However, it recovered to 54.65 per dollar in the early trade on capital inflows and weakening of the dollar from a fresh 4-1/2 year high against the Japanese yen due to disappointing US industrial data. The Indian currency was trading at 54.87 per dollar at the Interbank Foreign Exchange market. However, the rupee is likely to trade positive on hopes of rate cut by the Reserve Bank of India in its next monetary policy review next month.

Oil rebounded from the recent falls in Asian trade after upbeat US data boosted confidence in the world’s largest economy. New York’s main contract, light sweet crude for delivery in June, gained 14 cents to $94.35 a barrel and Brent North Sea crude for June delivery added 6 cents to $102.66 in midmorning trade.

The dollar held firm near five-week high against a basket of major currencies after US retail sales data eased fears of a slowdown in the world's largest economy. The yen held near 4 1/2-year low against the US currency as Group of Seven finance officials meeting over the weekend held back from criticising Japan's monetary policy. The dollar index hit a five week high of 83.438 on previous trading session and last stood at 83.217, with resistance seen at its April high of 83.494.

The rupee weakened by 32 paise to a three-week low of 54.57 against the dollar in its opening trade as the greenback strengthened against other currencies overseas. The Indian unit had closed lower at 54.25 on previous trading session. According to forex dealers, increased demand for the dollar from banks and importers has also put pressure on the rupee. However, positive domestic equity markets capped a further sharp fall as the rupee recovered to 54.46 per dollar.

Gold prices in spot and futures markets are likely to be volatile as buying in Asia seems to be making up for investors logging out of gold-backed assets elsewhere. Investors now seem to bet on equities for better returns than gold that has been dropping this year after running up continuously for 12 years. On previous trading session, total holdings dropped to 1,057.79 tonnes. In early Asian trade, spot gold fell and then rose to $1,456.97 an ounce, while gold futures maturing in June ruled at $1,456.20 an ounce.

Oil prices eased in Asia with investors taking profits after a rally on robust US jobs data and rising tensions in West Asia. New York’s main contract, light sweet crude for delivery in June, dropped 57 cents to $95.59 a barrel and Brent North Sea crude for June delivery shed 39 cents to $105.07.

Crude is moving nearer to $94.410 and is expected to rise up to 98 level. After that it may face some selling pressure which is also called as correction or profit booking. A major support can be found at $92.17. Intraday traders should not trade for 2-3 trading sessions in this commodity.

Currently moving at 1.30939 level, after making few sideway candle movements in daily basis. The pair will face a major resistance at 1.31550 for short time period. In major technical lower indicators, MACD is still showing buy signal and Stochastic is making buy signal for short term basis. Price line is moving above daily averages, which is positive for this pair. Support level can be found at 1.30233.

Silver futures for May traded lower by Rs 1625, or 3.66%, to Rs 42753 per kg in 3,465 lots. This level was last seen in January, 2011. The July contract declined by Rs 1052 or 2.32%, to Rs 44200 per kg in 223 lots. Prices had tumbled by 10% in previous trading session. Meltdown in precious metal in global markets on worries over Chinese growth and a possible sell-off by struggling Cyprus' central bank also weighed on the silver futures trade here.

The rupee rose 14 paise to 54.44 against the dollar at the Interbank Foreign Exchange market on selling of the US currency by exporters and banks. A higher opening in the domestic equity market and strengthening of the euro and yen against the dollar overseas, supported the rupee. The rupee had ended two paise down at 54.58 yesterday on renewed demand for the US currency from importers and continued capital outflows.