Indian Currency Outlook and Updates for Today

• The US dollar is expected to attract some selling pressure on rallies against the  INR. Utilize the highs in the USD/INR December contract to sell below 52.49 with target of 52.31/ 52.22 and a stop loss of 52.58.

• In the currency futures market, the most traded near-month dollar-rupee contract on the NSE closed at 52.30. The USD/INR December open interest was up by 2.7%. The January contract witnessed a decrease in open interest by 1.8%.
• Indian rupee is expected open slightly higher against the US dollar but again may have range bound session  if Europe sees muted action. For Rupee`s short-term as well as intraday movement depends on domestic news flows and India`s key Q2 GDP data and thereafter it reaction on stock market is crucial for rupee`s trend. Meanwhile at futures front in USD/INR (Dec) contract, technically speaking a decisive close below 52.10 would call for a major move downside to 51.66/74. While on upside, more risk is intact for a record high in the contract, a break above 52.42 takes it to 52.72 and that if breach then even much higher to 53.50. 
• Opening indications are mixed for the USDINR but the mood seems positive for the unit. Asian equities are down this morning as positive sentiments wane after downgrades of some European Banks.