Posts tagged ‘INR’

TICKS.INDIA - NSE MID CAP 50 at trendline supports

07.12.10 NIFTYMIDCAP50, INR, VIX, SENSEX
The beautiful NSE MID CAP 50 is at a key multi month trendline support. A break here will confirm negativity. The weekly RSI on INR and VIX non confirms takes support at 40 and points up. Sensex is also below key 20,000. The path of least resistance still points lower for Sensex and higher for INR and VIX.
TICKS.INDIA covers Nifty, Cnxit, Sensex, Nsebank, Bse Metals, top blue chips and their futures on an Intra day basis. The reports are published through a self refreshing webpage. The service starting 09:00 HRS (IST). Since TICKS.INDIA is a web based service it is only available through the Orpheus Site.

INDIAN RUPEE. ANTICIPATED AND HAPPENED

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WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators. REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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WAVES.FOREX - JAPANESE YEN POINTS HIGHER

WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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WAVES.FOREX - EURHUF - HUNGARIAN FORINT READY TO REVERSE

WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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EURUSD. The large primary degree B wave continues to unfold

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WAVES.FOREX - WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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EURUSD. NINE LEGS UP SUGGESTS A COMPLETE C/3 UP.

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WAVES.FOREX - WAVES.FOREX is a perspective product published TUE and THU. The report highlights the top traded FOREX PAIRS (e.g. Euro, Dollar, Yen, Indian Rupee, Romanian Lei, Swiss Franc and Dollar Index) The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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EMERGING FOREX - II

The best way to look at the connection between Forex and Equity markets would be to look at them together end of the month or after the end of a quarter. After a damaging bear market quarterly charts are still a bit unclear, but if you look at the end of month charts, you start seeing a glimmer of hope.

Fig. 1 and Fig. 2 are the charts of BETFI and Ron Dollar, the Romanian equity index and the local currency. The former has collapsed while the other has risen (weakened). And now we have a candle reversal formation on both of them. This means that both are looking at a reversal, a strengthening of currency on one side and the rising equity on the other.

Now one might say that emerging market Forex doesn’t move together. Fig. 3 an Fig. 4 are showing the comparison of the Indian equity Index Sensex against the Rupee. A similar relationship exists here. Both Emerging equity and Forex are at inflexion points.

Even if we don’t have a secular reversal immediately, we are nearing it. A few weeks should clear out trends. Till then watch the recent Forex highs and Equity multi month lows carefully.

The latest WAVES.FOREX carries ANTICIPATED and HAPPENED cases on Eurodollar and updates on the other Forex pairs.

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WAVES.FOREX is a perspective product published five days a week. The report highlights the top traded FOREX PAIRS (eg. EURO USD, DOLLAR INDEX, YEN USD, Indian Rupee, Romanian Lei, Swiss Franc, Hungarian Forint, Croatian Kuna, Canadian Dollar). The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

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THE DOLLAR CYCLES

During a telecon, a senior MTA member and my mentor Rona Schehrer from Zurich remarked that markets move around a few key assets. And inability to miss out on one can imbalance any sound portfolio. What Rona was mentioning was that even she could generate real alpha, she still had to understand Forex risk. The wild movements in dollar made a fund managers already tricky task trickier.

I promised her to have a detailed look at Dollar Index, so here goes. We have studied the inverted dollar index in this report. Inverted dollar index (=USD) is similar to the Euro Dollar (EUR=). Despite a comprehensive attempt to study Dollar cycles, we could not make an immediate secular case of weakness on Dollar. What we could see was a broad stagnation on dollar for 12-15 months, followed by further strength at least till late 2010. Only after which the next round of secular dollar weakness should begin.

We could be interpreting the cycles incorrectly, but if what we see is correct, then it’s not over for the paper assets. DOW and Global equity has a large bout of strength left. This should be good news for battered equity bulls and bad news for the crisis believers (majority now). This
also means that Gold collapse is more real than what seems. The fool’s gold is trapping as many bulls as it can.

On the minor and intermediate terms, dollar index could push up till 92 (previous 4 levels). After which the large multi month stagnation should unfold. The latest WAVES.FOREX carries other Anticipated and Happened cases on INR and RON Dollar. Euro Ron triangle is fizzling out. We are still expecting a leg up on Euro Ron before the multi month strengthening starts on Lei. If majority of world assets are against dollar and markets core competence is to confuse and surprise, the large multi month dollar stagnation we are talking about is at the right time.

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WAVES.FOREX is a perspective product published five days a week. The report highlights the top traded FOREX PAIRS (eg. EURO USD, DOLLAR INDEX, YEN USD, Indian Rupee, Romanian Lei, Swiss Franc, Hungarian Forint, Croatian Kuna, Canadian Dollar). The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

ORPHEUS GLOBAL RESEARCH

WAVES.FOREX is a perspective product published twice a week. The report highlights the top traded FOREX PAIRS (eg. EURO USD, DOLLAR INDEX, YEN USD, Indian Rupee, Romanian Lei, Swiss Franc, Hungarian Forint, Croatian Kuna, Canadian Dollar). The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools and sentiment indicators.

REUTER RICS: EURRON=, RON=, JPY=, INR=, HUF=, HRK=, GBP=, EURCHF=, CHFRON=, CAD=, =USD, EUR=

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The rupee correlation

There’s a lot of talk about how a currency affects the stock market and the economy. There is even literature available on the dollar and its beneficial effect on the Dow. A strengthening dollar is considered good for Dow components. The top 30 companies of the world have operations around the world and receivables in dollar. Thus, a strengthening dollar is considered positive for Dow blue chips.

Not a very different story connects the rupee with the Sensex and the rupee with Indian tech sector. A stronger rupee hurts exports and a weaker rupee benefits. Now this is about perception and theory. A real correlation check on how strong these correlations are reveals a different picture. Dollar-Dow correlation oscillates from positive to negative and not surprisingly the correlation of the rupee with the Sensex or CNX IT is also weak. The reality, just like always, is different from perception.

This is another economic rule which markets trash. We talked about the spin effect on currency last time. The reality of rupee proved us right again as the rupee broke the 40-mark. The story should now be that foreigners want to assume currency risk as local currency is strengthening against the dollar. Being invested in Indian stocks is a haven as both the Sensex and the rupee go up. This is a double benefit. But unfortunately even foreigners are human and as a group go wrong. Their investment strategy was weaker in Jun 2006 (rupee at 46.5), but itʼs stronger now that we hit 39.

Correlations are make-believe, there is no clockwork here. They cannot tell you where the rupee is headed and where it will take the Sensex with it. The big surprise always happens when people least expect it. We don’t see the rupee appreciating beyond 38, it’s a turning point for us. And we are not far from a dollar surprise as it turns around for a multi-month of strengthening. And about the Sensex, the immediate price targets lie at the Fibonacci confluence of 18,000 points despite what the rupee does and without health care, FMCG, auto and IT, which still reel under or near May 2006 highs. The positive correlations of yesteryears of these four sectors with the Sensex are turning sour now.


The Rupee Spin

Spin is an art and an important socioeconomic activity for politics, show biz, marketing and capital markets. Its capital market spinning which invariably falls on its head again and again. And only short public memory lets it thrive.

Let’s take the rupee. We have been tracking the rupee in this column since December 2006 from Rs 44.6 levels with anticipated targets near Rs 40 to the dollar. Our last column was in the thick of action as the currency made an eight-year high and strengthening spin was all over the place. While the spin was looking at strengthening citing GDP, forex inflows, Federal Reserve action, Asian currencies, IPOs and a host of other reasons, we said, “The psychological or wave impulse down seems incomplete. We will be surprised if any bounce back on the rupee crosses the 42 levels. We see this as a coiling continuing action. The main trend still seems down to near Rs 38 or lower,” on June 11, 2007.

After almost three months of price action, the rupee is still there coiling between 40 and 41.6. We still consider this as a counter trend move which should invariably resolve lower back to 40 and lower. Even month ending signals for August do not augur well for a bounce above 42. Between September and October, we should see a potential seasonal low for the currency as it attempts to retest 40 yet again. And with intermediate (multi-week) momentum continuing to be weak and the market-wide spin a bit muddled about the direction of the rupee, the currency might be ready to come out of a three-month long consolidation range and start trending again to get stronger vs the dollar.


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