If you enjoy speculating on unique forex pairs and trying to gauge political intrigues, the USD/PKR may be your best choice. The Pakistani Rupee continues to trade near important weakness long term and is still within sight of critical resistance above. However, the USD/PKR has actually enjoyed a slightly bearish trend the past week and tested important support levels near the 165.5000 mark.
Volatility and sudden spikes are part of the USD/PKR and this morning has proven no different, the Pakistani Rupee has seen bullish behavior surface in the past half hour as some buying of the USD/PKR has emerged and then was followed by another movement downwards. If you are looking for complete transparency and information when trading forex, the Pakistani Rupee is not for you. Trading within the USD/PKR needs to be undertaken by experienced traders who know how to use risk management, control their emotions and understand the inherent dangers of low volume which can cause swings of value rapidly.
The Pakistan government continues to make it known that is seeking an economic association with China and this is interesting via geopolitical considerations because India and China have seen an escalation in tensions the past few months. Pakistan and India are not the best of friends. Pakistan plans to be a big part of China's infrastructure projects regarding transportation and energy. Pakistan has a multi-billion dollar agreement with China which will help improve Pakistan’s ability to engage in trade in eastern and western Asia via port and road improvements. However, Pakistan’s economy remains challenged and while it is considered an emerging economy, Pakistan’s overall position internationally in commerce is lacking confidence within international circles.
Support near the 165.1000 level is very important for the USD/PKR and it has held since mid-June. The US Dollar has been weaker in the forex markets, but the question is if the Pakistani Rupee is really in a position to benefit from the USD weakness. It has appeared that a slightly bearish trend does have the ability to emerge, but selling the USD/PKR and looking for support to be vulnerable should be done very cautiously. If support does falter, it is conceivable the USD/PKR could test the 164.8000 level.
Trading the USD/PKR is all about experience and fortitude. Limit orders are necessary for this forex pair and stop losses must be used unless you want to risk wiping out your trading account. Can the USD/PKR break its current support lower? It is possible short term and a speculative selling position may actually be the most attractive – and adventurous – trading decision, but be careful folks.
Pakistani Rupee Short Term Outlook:
Current Resistance: 166.5000
Current Support: 165.2000
High Target: 167.4000
Low Target: 164.8000
