In fast trading this morning the USD/INR has stumbled lower again and is near the 79.0700 mark as of this writing. Conditions are quick and traders who want to step into the USD/INR currency pair are urged to use entry price orders, so their fills meet expectations. The downward momentum demonstrated in the USD/INR the past handful of days is likely testing the stamina of speculators who continue to look for climbs in value.
The bearish selling in the USD/INR has burst onto the scene and important support is being tested. The 79.0000 would seem to be an important psychological juncture for the Forex pair, but in other downward cycles this mark didn’t matter much in early August. The first week of August saw the USD/INR actually move within sight of the 78.5000 level. However, before bearish traders get overly ambitious, and aim for this depth they should look at the trading of the USD/INR over the past month and a half technically.
Downward Cycles have witnessed Upwards Reversals the Past few Months
Short term traders will have to carefully consider the technical terrain. Yes, the past week has seen the USD/INR move lower and the upper range of the currency pair has seemingly crumbled for the moment. However, downward cycles over the past year of trading technically have been met with sharp reversals higher in which new apex values have been made.
Perhaps some bearish traders are brave enough to proclaim the long term bullish trend of the USD/INR is dead. However, sellers of the USD/INR should be willing to ‘cash in’ their profits if they are achieved, instead of letting them linger in their trading account only to watch the ‘profits’ vanish into thin air when reversals higher emerge. Fundamentally there is reason to suspect the USD has not seen the last of its strong days demonstrated. The U.S Federal Reserve’s interest rate remains unclear long term and may remain hawkish for a handful of more months.
Support near 79.0000 should be Monitored Carefully
- If support near the 79.0000 level is not able to hold back the swarm of selling, the USD/INR could certainly test lower depths near the 78.9100 realm.
- Skeptical bullish traders may look at current prices within the USD/INR as a buying opportunity.
The lower short term value of the USD/INR may prove attractive to short term bullish traders. Yes, the USD/INR could certainly move lower, but if support ratios within the current price range remain durable, buying the currency pair and looking for short spurts upwards may prove to be worthwhile.
It may come to pass the next few days that the USD/INR becomes choppy, but remains within its upper price tier. The potential for buying the USD/INR on movements lower and wagering on action higher may prove tempting. Risk management is needed and careful use of leverage is urged.
USD/INR Short Term Outlook:
Current Resistance: 79.1450
Current Support: 79.0000
High Target: 79.3710
Low Target: 78.9180
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