USD/INR: Abrupt Spike Upward Breaks Key Resistance Levels

Robert Petrucci

Resistance levels were brushed aside swiftly by the USD/INR yesterday as the Forex pair spiked higher.

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In early trading this morning, the USD/INR is within a higher price range, and testing values seen on the 1st of March. As the month gets ready to end, all speculative bearish sentiment has been crushed by the swift spike generated in trading yesterday as resistance levels were made to look weak. The USD/INR has come off highs seen early today and is now testing support near the 73.4000 mark.

Trading has been fast in the USD/INR and speculators are advised to use limit orders short term. Technically, the sudden move higher by the USD/INR may have appeared to come out of nowhere, but from a fundamental perspective, the claim can be made that the USD/INR has reacted to the US treasury market once again, which is producing rapid trading as US President Biden gets prepared to campaign for a new round of stimulus packages.

Traders should keep in mind that the same type of move upwards occurred for the USD/INR in late February and early March also due to volatile US Treasury moves reacting to yields as financial institutions saw a change in the investing landscape. Technically, speculators who have been pursuing bearish momentum have an opportunity to look at values below which have been traded in earnest, and target the lower prices seen in the USD/INR quite recently.

However, short-term traders should keep in mind that the possibility exists that further volatility may be seen in Forex, including the USD/INR. The question for traders who are considering selling positions is if current support levels will prove adequate or if they, too, will fail. Traders should also understand this is a short trading week in the US because of the Good Friday holiday which is approaching, meaning it is possible that large transactions will come in a flurry today and tomorrow which could cause some volatility, particularly as they react to yesterday’s Forex results.

Traders who are cautious may prove to be wise near term. Limit orders should certainly be used. Quick-selling orders which target nearby support levels may be a speculative wager some want to make. However, traders may also want to pursue buying positions in the short term and use pullbacks in the USD/INR for potential opportunities to seek higher values which may be demonstrated and test current resistance.

Indian Rupee Short-Term Outlook:

Current Resistance: 73.5800

Current Support: 73.3100

High Target: 73.7800

Low Target: 73.1700

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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