More often than not, the price of the USDINR goes in opposite direction to the Indices. In fact I have seen this even in intraday movements.
The USD-INR chart suggests , what is technically called a positive divergence. This is a reversal signal indicating a halt to the current down move...
I expect that a break above 47.50 in the USDINR should give a move upto 49 - 49.25.
Now if the rupee is 'technically likely' to depreciate, the inverse relation with the stock indices gives us an indirect indication of an imminent correction!
Lets see how the currency market performs as a predictor of the stock markets !!!
Happy observing !
CA Rajiv D Khatlawala
Head of Research and Training
JHAVERI Securities Ltd
Baroda
3 comments:
Rajiv, what effect would the falling dollar have on metals like Nickel? Would the uptrend/breakout predicted by you fizzle out or would it take it higher towards the target of 810?
It would infact be positive for international comm traded on MCX
thank you....
Post a Comment