USD/INR: Consolidated Trading Range Intrigue

Robert Petrucci

The Indian Rupee has produced a fairly consolidated range the past five trading sessions as the USD/INR sustains its value.

After testing important support levels in early September the USD/INR has produced incrementally bullish trading the past couple of weeks.  This has not taken place without sudden surges downwards and upwards, but there can be no denying the Indian Rupee has shown an inability to sustain trading below the 73.2000 juncture below for very long since the 7th of September.

Global risk appetite has certainly become rather muted the past week as US equities have struggled to add onto their record highs, and in fact, have seen strong negative days. The USD/INR has certainly enjoyed a mid-term bearish run, but the past couple of weeks have seen the forex pair trade within a choppy range which traders may want to try to take advantage of by buying low and selling high while its consolidated range stays engaged.

The 73.4000 level now appears to be a rather interesting support level, yes it has been punctured lower consistently, but its value now looks to be a short term inflection point.  If this support level proves vulnerable it may mean another test to the 73.2500 to 73.2000 marks could develop. However, for this to occur it seems likely increased global risk appetite will also have to emerge globally within equity indices.

Traders need to remember the USD/INR can produce plenty of volatility and its sharp changes in direction can prove costly. Intriguingly the USD/INR continues to display rather strong resistance near the 73.6000 to 73.7000 levels. If the forex pair does develop slightly bullish momentum, speculators may be tempted to sell the USD/INR around the 73.5500 level to try and capture some downside cyclical trading action. Traders should be patient while trading the Indian Rupee near term and try to gauge global risk sentiment as part of their strategies.

Choppy conditions are likely to continue within the USD/INR as long as investors remain cautious, but it seems fairly likely that risk appetite will be displayed sooner rather than later. Meaning that the mid-term bearish trend within the USD/INR could reemerge and ignite more selling and give traders the ability to carry trades for a couple of days the opportunity to look for support levels to be tested.

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Indian Rupee Short Term Outlook:

Current Resistance: 73.6400

Current Support: 73.4000

High Target: 73.8100

Low Target: 73.2600

USD/INR

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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