Asianmacro loves trading & positioning in the Indian markets across FX, rates, equities & credits from time to time when special situations & catalysts comes about in this country. As it has such a messy democratic process, coupled with unpredictable weather (*rainfalls & weather is such a big thing for such an agrarian society). India also has a superstitious & chart crazy technical driven domestic market (*the Indians religiously follow candlesticks & all forms of chart studies including financial astrology) … and it all comes to a boil every now & then!
The massive depreciation of INR from 52 against USD to about 70 in 2013 together with the appointment of the well respected Raghuram Govinda Rajan as the Reserve Bank of India (RBI) governor in September 2013 when $/INR was 70 marked the peak & turnaround of the FX pair. Indian stock market, NIFTY rallied strongly since as well.
Presently, Asianmacro is worried about the impending return of El Nino http://www.livemint.com/Politics/JpJfZbdhAmV1qT3qWkVeoO/El-Nino-alert-issued-by-Australia-as-event-seen-developing.html & also the Indian elections is really a muddling headache for India whichever way it goes, where Modi while serving well within India is not viewed favourably in the West, http://blogs.ft.com/beyond-brics/2014/05/05/india-elections-four-pitfalls-for-modi-and-the-bjp/
From the chart above, it just make sense to me that unless there is really some good news coming out in weather or politics; having a short INR and short NIFTY position will be my favoured play to wear diamonds soon!