The USD/INR has been testing important support levels for the last week and may prove attractive to bearish speculators.
The start of trading this year for the USD/INR has produced choppy waters, but the Forex pair in the last week has begun to also trade in a manner similar to the past three months. This means that the USD/INR now finds itself solidly within its rather steady bearish trend and is testing critical support levels, which speculators with a taste for selling the USD/INR may find appetizing.
The USD/INR is hovering near the important 73.100 level and, if it drops below this value and can show a sustained fight, the psychological 73.000 mark will attract plenty of attentions from traders. The USD/INR has followed in the footsteps of many other emerging market Forex pairs. After moving towards lows during the holiday season and first days after the New Year, the USD/INR saw bullish momentum rise. However, the past week of trading has begun to see bearish sentiment creep into Forex against the USD.
The USD/INR has shown the ability to incrementally lower its value and resistance levels have not seen flagrant upheavals. The USD/INR has also managed to avoid massive volatility while it has seen its bearish trend begin to emerge. Traders now see support levels being tested technically and large reversals upwards have not been able to build much momentum.
Resistance near the 73.170 level is close, but if the juncture proves durable and the USD/INR continues to fight near the 73.100 mark, traders cannot be blamed for suspecting that a test of lower values will soon emerge. On the 4th of January, the USD/INR touched lows near the 72.750 juncture, and this came about after trading at the end of December broke through the 73.100 mark and saw a flurry of additional selling gain momentum.
Forex markets once again have full trading volume; this ingredient and a lack of violent reversals higher indicate that the USD/INR may be within a level which will see another spark lower as the Forex pair reinvigorates its bearish trend. Traders should be careful not to be too greedy if they are selling the USD/INR; using take profit orders is encouraged to cash in winning positions before they vanish.
Speculators may find pursuing bearish positions of the USD/INR worthwhile at its current levels, but they are still reminded to use limit orders to protect against unexpected spikes, which are known to happen within this Forex pair. Selling the USD/INR looks like a solid speculative wager and an expectation that support levels will prove vulnerable near term may prove to be correct.
Indian Rupee Short-Term Outlook:
- Current Resistance: 73.170
- Current Support: 73.040
- High Target: 73.250
- Low Target: 72.900