- The US dollar has initially fallen against the Russian ruble, but it did turn around and find a little bit of support at 88.50, a level that's been important multiple times.
- Because of this, I think we are looking at a bottoming pattern, and at this point, I would like to see the US dollar break above 90 rubles to start buying.
- In that area we also have the 200 day EMA that a lot of people will be paying close attention to and it opens up the possibility of a move to the 94 rubles level.
I don't necessarily think that it's going to be an easy move higher but if you look at the actions over the last several months that does seem to be the overall proclivity of this pair. After all there are a lot of sanctions on Russia although they are still selling oil to even the European Union.
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Concerning as to whether sanctions matter?
This has currency traders somewhat concerned. However, by most reports that I've seen, the Russian economy is holding up quite well. So, I think that's why we are just in this sideways kind of feeling at the moment or action. Ultimately, I do think that we will have to make a bigger decision, but as things stand right now, even as we drift lower, especially near the 88 level, it seems like people were willing to step and try to buy the green back again. So, I think it's a situation where the ruble isn't as bad as we thought, but the US dollar continues to take it on the chin against multiple other currencies around the world.
So, I think that's what the push-pull is going to be all about in this USD/RUB market. I assume that we remain range-bound until proven otherwise. You probably need to employ Occam’s razor here, meaning that if it looks range bound, it probably is until something radically changes.
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