The past month of trading in the USD/INR has taken on an intriguing speculative flavor. While looking at the forex pair with a mid-term perspective one might assume its values have been relatively calm and nothing much has happened which is noteworthy. However, traders of the Indian Rupee would likely quickly disagree with this insight and point out that the relatively consolidated and calm waters of the USD/INR provide momentary spikes which can create frightening scenarios when risk management is not being used.
The USD/INR remains close to important support ratios within a mid-term bearish trend. The past day has also seen the Indian Rupee begin to sustain trading below the 73.3000 level which had proven to be a juncture that was hard to penetrate previously. If the USD/INR can continue to trade below the 73.3000 it may raise suspicion an additional wave of selling within the forex pair may be about to occur. But is that correct?
October has provided a range mostly between the 73.000 and 73.4500 junctures, but this trading is a limited scope. Early September saw the greatest amount of bearish pressure within the USD/INR as the forex pair tested values near the 72.9000 level very briefly before experiencing a strong reversal upwards which began to test resistance near 73.9000 only a handful of days later. Since then a predominant amount of the trading for the USD/INR has been between 73.2500 and 73.8500 and sudden spikes have been demonstrated too.
Risk appetite in the global markets is certainly a factor for the USD/INR and traders who are technically minded need to make sure they are paying attention to the results on equity indices worldwide. Investor sentiment appears to be rather proactive near term and while many analysts may be wary about the possibility of profit-taking to be exhibited soon, some speculators of the USD/INR may be inclined to believe another wave of risk-taking could create more momentum for the forex pair’s bearish trend.
However, traders would be wise to look at risk-reward scenarios carefully regarding where the greatest amount of value momentum can be found. Limit orders which allow for the USD/INR to retrace higher values and then seek downward momentum may be an avenue short term to pursue. Additionally, speculators who believe the USD/INR has traversed too swiftly and support will prove strong may want to be buyers and capture brief upside swings within the consolidated short term trading range which is being experienced.
Indian Rupee Short Term Outlook:
Current Resistance: 73.3100
Current Support: 73.0600
High Target: 73.5900
Low Target: 72.9500
