Trading the USD/INR has not been for the faint of heart the past couple of weeks. The forex pair has delivered fast trading conditions while staying in a known range, which means speculators need to be using limit orders if they are highly leveraged. The USD/INR has also been showing an inclination to retest support levels while resistance has incrementally lowered.
Trading this morning in the USD/INR again is near the important 73.3000 mark, but interestingly the forex pair has shown the ability to trade slightly below the juncture too. If the forex pair can continue to demonstrate a sustained value below the 73.3000 mark it will interest bearish speculators who believe further downward price action is a possibility.
Global risk sentiment has reasserted itself the past few trading days. While there are no sure things and risks always shadows forex and equities, if optimism continues to finds momentum globally the USD/INR may see more bearish momentum. The USD/INR has proven volatile recently and traders need to practice full risk management if they are active within this forex pair.
However, the mid-term while certainly having days in which higher spikes and reversals have suddenly emerged has also been able to deliver a rather solid bearish trend. Since mid-June, the USD/INR has incrementally been able to challenge support levels and breakthrough to lower values. India is still deep within the midst of battling a public health emergency due to coronavirus. However, the nation has also been transparent about the pandemic's statistics.
The USD/INR is still trading above its pre-coronavirus implication values. Yes, speculators who believe reversals will remain part of the trading landscape can certainly look at the resistance above and see a consistent amount of tests which have been demonstrated and serve as evidence that buying the USD/INR can be profitable too.
Short term traders need to have quick goals when trading the USD/INR. They should pay strict attention to the forex pair’s movements. Momentum within the USD/INR has shown a distinct ability to shift rapidly. However, over the mid-term, the USD/INR has also shown a tendency to be in a selling mode which means risk-reward scenarios seem to favor bearish speculators. Selling the USD/INR around the 73.3500 level and looking for additional downside action is a reasonable position, provided you are using adequate stop-loss ratios above.
Indian Rupee Short Term Outlook:
Current Resistance: 73.4000
Current Support: 73.2500
High Target: 73.6000
Low Target: 72.9500
