USD/IDR: Testing Resistance Consolidation Broken

Robert Petrucci

The USD/IDR has broken through resistance and will challenge technical traders as the week closes.

The Indonesian Rupiah has lost value to the US Dollar the past couple of trading sessions. After testing strong support near the 14360.0 juncture repeatedly since early July, a reversal higher has taken place. The buying of the USD/IDR has been strong and risen to a resistance level it has not approached since early June.

Resistance near the 14650.0 level may prove to be a vital target for speculators. Technical traders will have their decisions challenged as they try to decide if the short term consolidation which has been broken is a sign the USD/IDR will exhibit an increased bullish trend. Risk sentiment early today has been mute as traders have taken many of the equity indices lower in Asia. If resistance crumbles again and a buying trend continues short term for the USD/IDR it could signal a retest of the 14700.0 mark which proved a key inflection point in late May.

Traders who have a taste for speculative positions however may believe the USD/IDR will see its short term bullish trend run out of steam. Traders with this perception may look at levels between 14600.0 and 14650.0 as selling opportunities to see if the Indonesian Rupiah will retest support it touched only a few days ago. The support level of 14500.0 could prove important for speculators with a belief a bearish trend will develop. If this juncture is broken and selling of the USD/IDR strengthens it could refuel a test of the 14400.0 support level quickly.

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The Indonesian Rupiah offers traders an opportunity to trade the USD/IDR and search for large movement per its basis points within the forex pair’s value range. The amount of leverage used while trading the USD/IDR is important and needs to be judged carefully. Since the 5th of June when the USD/IDR saw a strong selling trend take the Indonesian Rupiah to approximately 13880.0 the forex pair has rebounded with bullish momentum and broken through resistance levels consistently.

Traders have a tough decision to make if they are short term traders and do not like holding positions overnight and particularly over the weekend when developing news can affect the trading landscape. The USD/IDR is near important resistance, but these resistance levels have not been tested in nearly a month. Shorting the USD/IDR could prove an interesting gambit the next two days, but stop losses need to be in place as you look for downward reversals and support levels seen earlier this week.

Indonesian Rupiah Short Term Outlook:

Current Resistance: 14650.0

Current Support: 14500.0

High Target: 14680.0

Low Target: 14400.0

USD/IDR

Robert Petrucci
Robert Petrucci has worked in the Forex, commodity, and financial profession since 1993. Important aspects of his work involve risk analysis and advisory services. As an advisor in a Family Office he maintains a conservative approach for wealth management and investments. Robert also works in private finance with investors and companies delivering financial and management services.

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