USD/INR: Delivering Challenging Bearish Trend

Robert Petrucci

The USD/INR continues to show a bearish mid-term trend, but if may be proving difficult for some traders to gain an advantage.

While the USD/INR has delivered a bearish trend over the mid-term it has not come without a fight. Trading below the important inflection point of 73.3000 has been experienced early this morning, but traders need to understand that this mark has been tested in the short term consistently and proven to be a magnet for choppy movements. The ratio is proving to be a consistent battleground.

Perhaps the most important aspect of the USD/INR is where its current resistance level will prove valuable. Short term technical charts point to the 73.4200 juncture as a level that could fight off reversals higher. The emergence of the mid-term bearish trend within the USD/INR has also produced tests higher often enough to make speculators worry about resistance levels, so looking at a higher target of 73.6000 may prove the safer wager. However, that level if chosen as a stop loss will need a conservative amount of leverage used when trading because of the money that could be lost on a quantified basis point move.

The 73.3000 however should serve as a reminder the USD/INR is trending lower. Let there be no doubt this forex pair has delivered sudden spikes which will likely continue to haunt the unprepared trader, so risk management is certainly needed. Yet, the USD/INR has incrementally seen resistance become lower and if values remain within a window of 73.2800 to 73.3900 traders may be inclined to suspect another leg lower for the forex pair is going to develop.

Early on Friday of last week, the USD/INR did decline to the 73.1000 level, but experienced a strong reversal upwards. However, this level may be an indication of where the biggest target for the forex pair awaits. Traders need to be extremely careful within the USD/INR. It is recommended that limit orders be used so your price ‘fill’ doesn’t surprise you. Eliminating the possibility of getting a bad fill that could occur during a sudden spike is a solid first step. Yes, if you enter a live market order you may get a good fill, but there is a risk you won’t.

The USD/INR continues to look like selling the pair carries the best risk-reward scenario. Traders need to use take profit orders to catch their targets effectively. Traders must also not become too greedy within the USD/INR; they should be satisfied with smaller profits, so they do not suffer from sudden reversals. Selling the USD/INR near the 73.3300 to 73.3900 level and looking for downward moves towards the 73.2800 juncture and lower may prove a worthwhile trade.

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Indian Rupee Short Term Outlook:

Current Resistance: 73.4200

Current Support: 73.2800

High Target: 73.6100

Low Target: 73.1000

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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