The USD/INR touched the 81.5200 price vicinity on early Friday of last week. This low which challenged values not seen since the end of January was a telling sign and shows that speculative interest in the USD/INR remains. Traders with the ability to wager on the USD/INR via brokers certainly have an opportunity to speculate on the currency pair and potentially take advantage of its rather intriguing near-term trends which have been strong.
After touching the depths of nearly 81.5200 late last week the USD/INR has reversed higher significantly. The price action in the USD/INR has correlated to the broad Forex markets rather well, and the climb over the 82.0000 and sustainment of these higher values also shows that global behavioral sentiment is being reflected within the USD/INR. The USD lost value in the middle of last week as slightly lower than anticipated inflation numbers caused a selloff. However, this was met by U.S Federal Reserve officials taking to microphones rather quickly late last week to warn that inflation remains too high and still must be battled.
Selling in the USD/INR Suddenly Stopped and Nervous Behavioral Sentiment Escalated
Without any major economic data releases the remainder of this week from the U.S financial houses will get most of their impetus from sentiment generated by risk appetite. Yes, tomorrow weekly employment numbers will be released in the U.S, but unless there is a major surprise, traders will look more at the major equity indices. On Friday U.S Services and Manufacturing PMI statistics will be published.
Financial houses have certainly priced in another interest rate hike from the U.S Federal Reserve early this coming May. The question is what the U.S central bank will do after that, and last week’s rhetoric from U.S Fed members led many financial houses to believe another addition to the Federal Funds Rate could happen in June.
- The 82.0000 price level of the USD/INR should be watched. If momentum sustains the price above this level it will be a sign nervous sentiment remains strong.
- However, if the 82.0000 level is broken lower in the USD/INR it may signal additional selling could take place and exhibit financial institutions are still wagering on U.S Federal Reserve dovish sentiment to develop in the mid-term.
Trend Higher in Recent Days is Challenging Resistance Levels in the USD/INR
While some speculators may be filled with the desire to sell the USD/INR based on its results in the middle of last week, the short-term trend has been higher. If a price of 82.1000 is sustained in the short-term this could be a sign more buying could take place over the next couple of days which could bring the 82.1300 to 82.2100 prices into focus.
USD/INR Short Term Outlook:
Current Resistance: 82.1250
Current Support: 82.0010
High Target: 82.2670
Low Target: 81.8960
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