The Indian Rupee continues to demonstrate an ability to test a wide range. After testing its weakest June values about ten business days ago as heavy buying took place within the USD/INR forex pair, the Indian Rupee has staged a solid reversal and shown the ability to add value.
The month of June has provided traders with two dynamic short term trends. Starting out the month the USD/INR traded near 74.8000, but the next two weeks saw buying emerge and took the Indian Rupee to weak values near 76.2000. However, sellers have again emerged and put the USD/IND almost in the middle of its monthly trading range.
Short term the USD/INR will certainly be sensitive to global risk appetite. Today’s trading in Asia has opened with some risk taking, but global markets appear ready for a mixed day. Futures from the US equity indices suggest some profit taking – selling – will take place when Wall Street opens. However, yesterday’s early outlook was negative too from the US, and the stock markets put in a very optimistic day of buying producing solid gains.
The current value range of the Indian Rupee between 75.2500 and 75.3500 offers an opportunity to play both sides depending on speculative perceptions. Short term support looks reasonable near the 75.1500 level and has seen this mark touched early this morning. If this support proves vulnerable traders could aim for the 75.0000 juncture. However, due to the fact the USD/INR stands in the middle of its month long range questions will be raised about direction. Traders who like one day charts will clearly see the USD/INR is relatively close to important support levels, which may cause them to speculate a test of resistance is the right direction to speculate.
Buyers of the USD/INR may feel from a technical position that evidence is on their side and they might also want to consider existing market sentiment globally looks uneasy. If forex pairs begin to come under pressure today and tomorrow it seems to be more likely that it will be risk adverse trading that affects the landscape, meaning buying the USD/INR at its current price values could prove a worthwhile buying opportunity.
As always the USD/INR is a dynamic trading landscape and can prove suddenly vulnerable to shifts in global sentiment. However upside potential and a test of resistance levels seems to be the more attractive speculative trade today with a buy of the USD/INR. If you are selling the USD/INR the chance for a breakout below current support levels seems limited in the short term.
Indian Rupee Short Term Outlook:
Current Resistance: 75.7000
Current Support: 75.1500
High Target: 76.2000
Low Target: 75.0000
