{"id":9610,"date":"2014-11-11T16:35:43","date_gmt":"2014-11-11T11:05:43","guid":{"rendered":"https:\/\/www.moneyworks4me.com\/investmentshastra\/?p=9610"},"modified":"2020-03-04T16:52:42","modified_gmt":"2020-03-04T11:22:42","slug":"rupee-technical-report","status":"publish","type":"post","link":"https:\/\/www.moneyworks4me.com\/investmentshastra\/rupee-technical-report\/","title":{"rendered":"Rupee Technical Report"},"content":{"rendered":"<p style=\"text-align: justify;\">Current Spot Quote: 61.50<\/p>\n<p style=\"text-align: justify;\">View: Bearish (On rupee)<\/p>\n<p style=\"text-align: justify;\">Target: 66.50<\/p>\n<p style=\"text-align: justify;\">Time-frame: By Feb 2015<\/p>\n<p style=\"text-align: justify;\">Strategy: Create longs between 61-61.50 with a Stoploss of 57.8 for 66.50(Spot levels)<\/p>\n<p style=\"text-align: center;\"><strong>Rational<\/strong><\/p>\n<h3><strong>Currency Chart:<\/strong><\/h3>\n<p><a class=\"gridlove-popup-img\" href=\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/ss-graph.png\"><img decoding=\"async\" loading=\"lazy\" class=\"aligncenter size-medium wp-image-9614\" src=\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/ss-graph-300x202.png\" alt=\"ss graph\" width=\"300\" height=\"202\" srcset=\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/ss-graph-300x202.png 300w, https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/ss-graph.png 635w\" sizes=\"(max-width: 300px) 100vw, 300px\" title=\"\"><\/a><\/p>\n<p style=\"text-align: justify;\">As can be seen from the Charts USD-INR has a Strong support placed at 60.50 levels with other crucial trendline support placed at 61\/61.2 levels. On a standalone basis charts suggest USD-INR Pair would have probably bottomed and any dips could be used an opportunity to buy.<\/p>\n<h3 style=\"text-align: justify;\"><strong>Inter-market Analysis:<\/strong><\/h3>\n<p style=\"text-align: justify;\">Over a period of time emphasis in the Technical world has shifted from Single Market to a more inter-market approach. In an increasingly interrelated financial world, the ability to study all markets gives Technical Analysts a huge advantage. No markets move in isolation and analysis of one market should include all the others. The four major groups are stocks, bonds, commodities and currencies, of which, Dollar and commodities trend in opposite directions. We believe falling commodities especially Gold and Crude will continue to have positive effect on USD.<\/p>\n<p style=\"text-align: justify;\"><a class=\"gridlove-popup-img\" href=\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/ss-graph-2.png\"><img decoding=\"async\" loading=\"lazy\" class=\"aligncenter size-medium wp-image-9615\" src=\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/ss-graph-2-300x220.png\" alt=\"ss graph 2\" width=\"300\" height=\"220\" srcset=\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/ss-graph-2-300x220.png 300w, https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/ss-graph-2.png 615w\" sizes=\"(max-width: 300px) 100vw, 300px\" title=\"\"><\/a><\/p>\n<p style=\"text-align: justify;\">Gold has recently given a breakdown from Descending triangle continuation pattern and could further fall to lower levels. Given this context, it is likely that Dollar will strengthen further across other global currencies.<\/p>\n<h3 style=\"text-align: justify;\"><strong>Significant underperformance of INR Vis-a-Vis Equities:<\/strong><\/h3>\n<p style=\"text-align: justify;\">We have seen Nifty rallying close to 8-10% from the lows of 7700-7750 created on 17<sup>th<\/sup> Oct. However currency after turning volatile initially has been at the same levels of 61.5-62 levels. We believe this trend is likely to continue till Nifty rallies and a rising Nifty will have minimal impact on the rupee. However once Nifty starts correcting Rupee could also tumble. A closer look at the historical seasonality pattern of Nifty reveals that Nifty has a seasonal tendency of topping out or at least witnessing a sizable correction in the first quarter of every year especially January and February. In case the event repeats and unfolds itself with Nifty Correcting in January and\/or February we may see accelerated fall in rupee which could take rupee to 66-67 levels.<\/p>\n<h3 style=\"text-align: justify;\"><strong>Dollar Index Chart:<\/strong><\/h3>\n<p style=\"text-align: justify;\">We have seen dollar Index Giving breakout out from \u201cComplex Inverse Head and Shoulder Pattern\u201d. A complex Inverse Head and Shoulder pattern is a variance of standard \u201cInverse Head and Shoulder Pattern\u201d in which we could have 2 Heads and\/or numerous shoulders. However the trading psychology remains the same. The 2 heads on the charts as can be seen by \u201cH\u201d can also be taken as a \u201cDouble Bottom formation\u201d. Irrespective of which ever Chart pattern we take, the view on Dollar Index remains upbeat.<\/p>\n<p style=\"text-align: justify;\"><a class=\"gridlove-popup-img\" href=\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/SS-graph-3.png\"><img decoding=\"async\" loading=\"lazy\" class=\"aligncenter size-medium wp-image-9616\" src=\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/SS-graph-3-300x169.png\" alt=\"SS graph 3\" width=\"300\" height=\"169\" srcset=\"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/SS-graph-3-300x169.png 300w, https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-content\/uploads\/2014\/11\/SS-graph-3.png 660w\" sizes=\"(max-width: 300px) 100vw, 300px\" title=\"\"><\/a><\/p>\n<h3 style=\"text-align: justify;\"><strong>Inflation Rate Differentials and Interest Rate Parity:<\/strong><\/h3>\n<p style=\"text-align: justify;\">Inflation Rate Differentials and purchasing power parity forecasts that the exchange rate will change to offset price changes due to inflation. For example if prices in India (Inflation) increase by 8% and prices in US (Inflation) increase by 2%, the Inflation differentials between the two countries would be (8%-2%= 6%). This means that prices in India are expected to rise faster relative to prices in USA. In this situation, the Purchasing Power Parity approach would forecast that the INR would have to depreciate by approximately 6% to keep prices between both countries relatively equal.<\/p>\n<p style=\"text-align: justify;\">Interest Rate Parity is a theory which states that the interest rate differential between two countries is equal to the differential between the forward exchange rate and the spot exchange rate. Interest rate parity plays an essential role in currency markets, connecting interest rates, spot exchange rates and forward exchange rates.<\/p>\n<p style=\"text-align: justify;\">With key interest rates and inflation still significantly higher in India than the US, we believe rupee will at least not rally hereon and could even probably meet the targets of 66-77 as mentioned in this report.<\/p>\n<p style=\"text-align: justify;\"><strong>Disclaimer<\/strong>:\u00a0The views expressed in this article are those of the\u00a0author and do not necessarily represent the views of, and\u00a0should not be attributed to MoneyWorks4me team or website.\u00a0This publication has been prepared solely for information purpose and does not constitute a solicitation to any person to buy or sell a security. 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[&hellip;]<\/p>\n","protected":false},"author":512,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","footnotes":""},"categories":[3],"tags":[1049,1118,1121,1120,83,1119],"modified_by":"MoneyWorks4me","_links":{"self":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts\/9610"}],"collection":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/users\/512"}],"replies":[{"embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/comments?post=9610"}],"version-history":[{"count":0,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/posts\/9610\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/media?parent=9610"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/categories?post=9610"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.moneyworks4me.com\/investmentshastra\/wp-json\/wp\/v2\/tags?post=9610"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}