Currency Report – Rupee to sizzle to 48

 

Ofcourse a coupl eof bank trading desks have been waiting for this moment and have pushed a 48 target for Fiscal 2013, but the long term trust and focus built on a tirade of FII participation in the World’s “only” market growing at above 5% and showing having likely bottowmed out is serving Rupee traders sell as they bore the weight of  a big down move thru the first half, hitting 57 as late as August.

The Rupee todyay officialy channeled into below 52 trades at the start of the October series, the spot rate likely near 51.70 and lower despite weak equities egging on a blind man’s channel up for the Dollar on the Rupee. The Commodities situation has also reached a peaked state and Oil lost to the bottoms in the traditional india month for Gold buying stabilising international lows on the currency

Copper is likely headed for the correction down and probably Natural Gas and Copper will both run down quickly and stiffly as Oil rifles up the cleaning bore and into more demand charts

The Rupee thus has again landed the 2009 international vortex from which inflation risks stay abated and CAD has already come down to $16.7 B for the period April – August.

 

Reliance losing in brand games and policy

Reliance’s gas pricing quandary continues with warehouse owner IGL retailing gas at up to $15 and Reliance following its earlier efforts at increasing its $4.2 supply rates to PSE Oil companies with a suit against the government asking it to pay more for the gas purportedly using the IGL model for itself even as a distribution supplier and not a retail distco like IGL or Petronet LNG

Reliance has failed on maost strategic fronts except in greenfield consumer and sports ventures like the Mumbai Indians team franchise , co branded cards etc where it has yet to begin or dowes not pull significant revenue compared to the Oil brand. Reliance has been almost synonymour with petrochemicals and oil enterprise int he country away from issues of subsidy and government benefaction for a decade or so, with Petro margins and oil and gas discoveries keeping markets happy,. Its last 2 years in the dust have been tough for Indian markets as a whole and there still might be a significant correlation thouhg not an over arching one between its and Brand India’s fortunes.

Reliance I would like to believe has frittered away the market’s dull times in continuing to expect largesse and

Mumbai Indians
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“sympathetic understanding” from public sources and markets. Its consumer brands are in no position to claim leadership and thus have no significant launches to their name. Its LTE venture is  working out a smashing deal at 10X the 3G industry’s competition and while ADA group has not done nay better either, it has at least delivered on time in long gestation projects which others would not even take up including the Power sector where delays and “non performance” are more understandable. Mukesh’s Reliance has not aggressively moved in infrastructure because it knew that investors would not empathise with the “long run” financing requirements of the sector but still, its alternative plans are almost in a state of a “null” ennui without response or favor it so much loves in its dinner plate.

There are no loyal investors left onthe Reliance bandwagon and they have to move fast before the M&M’s and the JP ‘s take over fromt hem with 1/10th the capitalisation and a much larger understanding of the current market and who it can be argued worked with almost the same handicaps and invested in unforgiving propositions

Also ADA’s failures in the financial services area could be a thing of the past soon when even they can look at aggressive growth again, leaving big brother with no work or profits on hand

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Predilections: If you still mind shorting the market..

Huddle

Though that is not from Fibonacci or for the Fib series, some tormentors on virtual soot could very well push the case forit. However while immature shorting has scored a few gray areas out from the market maps n the last few weeks when it began, now traders who get scared by shorting could very well be losing a packet as intra-day movements are long range and compete a week’s trend in half a session for all practical purposes pushed by paper thin volumes. There is a lot of downstream wind for the markets to rest lower and yesterday’s move though decisive and covering a lot of the range down, do leave a lot of room for fresh Put purchases which also has o spread out from an overt concentration on Nifty. .Anywaya lot of us would still be praying for the secular up move to start away, while worried about purchasing that long long position we want. Buying should still be concentrated in smaller lot son the bigger scrips and I really do not see any value mid caps out there with banks and tv networks driving growth and not being really there on the exchanges. (Disclaimer: This author suffered from air shock when NDTV was listed and its over leveraged financials disclosed much later and still continues to consider himself a savvy investor, market maker and trader fit for any Global bank position in Trading, Marketing or Sales)

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