If you are not an experienced trader you should think twice before attempting to try and speculate with the USD/PKR. This is not a forex pair for the weak of heart. Limit orders, patience, deep pockets, and luck are all needed to successfully trade the Pakistani Rupee, and this may not be enough to be profitable.
After some testing of support levels near 165.5000 early last week, the USD/PKR finds itself battling resistance as it bounces near the 168.0000 juncture. The current price levels of the USD/PKR are testing record low values for the Pakistani Rupee against the US Dollar. Buying of the USD/PKR remains the preferred long term trade for this forex pair. However, this is not a simple endeavor for traders because even if bullish behavior continues for the USD/PKR, there are factors that must be successfully navigated in order to profit.
Placing a limit order is essential, because if you do not protect your entry point with the USD/PKR you may find yourself getting a price fill in a market without high transparency and no way to argue the value you have been allotted. Then you must consider timeframes, because the USD/PKR may take one minute, one day, one month, or longer to break its current resistance levels higher. Which means you may be charged a carry fee for holding your forex position overnight.
A smart trader may ask if the resistance level is so strong and uncertain regarding its timeframe why not short the USD/PKR and aim for support below? My answer is a wave of the hand in friendship and bow as you enter the casino to try your luck. Yes, support levels are tested frequently within the USD/PKR and a properly placed limit order to sell the USD/PKR and a take profit order at a nearby support level is an intriguing prospect.
As a matter of fact, shorting the USD/PKR might be the best speculative trade for the Pakistani Rupee. However, by trying this trading avenue you must acknowledge you are wagering against the long term trend of the USD/PKR. Therefore, risk management and stop losses are not only important, but they are critical to guard against bloodshed from wounds against your cash balance within your trading account.
So if you want to enter a casino type of trade this is the idea, place a limit order to sell the USD/PKR at 168.0000 and a take profit near the 167.6000 juncture. And yes, folks please use stop losses which protect your money wisely based on the amount of leverage you are using. Saying a little prayer to the gods of forex might be a good suggestion too. Also, please acknowledge the volatile nature of the Pakistani Rupee before you consider this dangerous mission.
Pakistani Rupee Short Term Outlook:
Current Resistance: 168.5000
Current Support: 167.6000
High Target: 169.0000
Low Target: 166.5000
