- USD/INR edges lower on Thursday and stalls a two-day recovery trend from a multi-month low.
- The technical setup seems tilted in favour of bears and supports prospects for a further downfall.
- A sustained move back above the 200-day SMA is needed to negate the near-term negative bias.
The USD/INR pair struggles to capitalize on its recovery gains registered over the past two days, from the 81.65 region, or the lowest level since early May and attracts some sellers during the Asian session on Thursday. Spot prices, however, manage to recover a few pips from the daily low and currently trade around the 82.00 mark, down less than 0.10% for the day.
From a technical perspective, the recent breakdown through ascending trend-line support extending from November 2022, which coincided with the very important 200-day Simple Moving Average (SMA), favours bearish traders. Moreover, oscillators on the daily chart have just started gaining negative traction and add credence to the outlook. This, along with the prevalent US Dollar (USD) selling bias, suggests that the path of least resistance for the USD/INR pair is to the downside.
Hence, a slide back towards testing a multi-month low, around the 81.65 area touched on Tuesday, looks like a distinct possibility. The USD/INR could slide further towards the next relevant support near the 81.50 zone. Spot prices could eventually drop to test sub-81.00 levels or the YTD low set in January.
On the flip side, the 200-day SMA, currently pegged around the 82.20 region, might continue to act as an immediate strong barrier. A sustained move beyond might trigger a short-covering rally and lift the USD/INR pair towards the 82.70-82.80 supply zone. Some follow-through buying might then allow bulls to make a fresh attempt to conquer the 83.00 round-figure mark, which has been acting as a strong barrier since the beginning of this year.
Hence, a convincing breakthrough will be seen as a fresh trigger for bullish traders and set the stage for an extension of the USD/INR pair's well-established uptrend witnessed since August 2022. Spot prices might then surpass the all-time peak, around the 83.40-83.45 region touched in October 2022, and aim to reclaim the 84.00 mark.
USD/INR daily chart
-638260291904161358.png)
Key levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD consolidates near 19-month peak as traders await US PCE Price Index
AUD/USD oscillates in a range below the 0.6900 mark, as traders opt to move to the sidelines ahead of the US PCE Price Index. In the meantime, the RBA's hawkish stance, the optimism led by additional monetary stimulus from China, the prevalent risk-on mood, and a bearish USD continue to act as a tailwind for the pair.
EUR/USD rebounds on Thursday after midweek pullback
EUR/USD tuned back into the high end on Thursday, getting bolstered by a broad-market selloff in the Greenback. US data that printed better than expected helped to ease concerns of a possible economic slowdown within the US economy looming over the horizon.
Gold price holds steady near record peak; looks to US PCE data from fresh impetus
Gold price consolidates below the all-time high set on Thursday amid overbought conditions on the daily chart and the risk-on mood, though dovish Fed expectations continue to act as a tailwind. Bulls, meanwhile, prefer to wait for the release of the US PCE Price Index before placing fresh bets.
Ethereum investors show bullish bias amid ETF inflows and positive funding rates, exchange reserves pose risk
Ethereum traded around $2,640 on Thursday, up more than 2% following increased bullish bias among investors, as evidenced by ETH ETF net inflows and an uptrend in funding rates. However, investors may be wary of a potential correction from ETH's rising exchange reserve.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.