The USD/INR soared to record highs upon opening this morning, as it smashed its way to values that seemingly destroyed technical resistance for a moment.
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Trading the USD/INR currency pair may prove to be too dangerous for traders in the short term. Forex trading as a whole is producing a fireworks show globally and speculators who do not have deep pockets may be best served to watch and study in the near term. Having said the above, allow us to try and make sense of what is going on in the USD/INR.
Having already gone into the weekend at record highs around the 81.2200 level, this morning’s trading in the USD/INR opened with a gap higher soaring upwards. The price of the USD/INR at this moment is nearly 81.5600 which are testing its all-time highs, yes, created today. Last week’s central bank interventions globally may continue to produce more interventions near term, and the Reserve Bank of India is likely to be among them.
Rocket Ride of the USD/INR will try to be controlled by the Reserve Bank of India
The price action created upwards in early trading today is certainly being watched by the central bank of India. Retail traders need to understand that there are almost certainly actions being taken and planned, to try and control the pace of the USD/INR, this so the Indian Rupee doesn’t lose too much value. The question speculators need to ask besides obviously paying attention to the anticipated volatility, is if the Reserve Bank of India can legitimately have a strong effect on the pace of the bullish momentum of the USD/INR?
Resistance levels can certainly be pointed to by technical traders, but the results the past few days of trading makes the USD/INR highs look seemingly like weak theories. It may be tempting for some traders to try and be heroes and say they are going to attempt to sell the USD/INR and seek reversals which are bound to occur, but this could also prove deadly to trading accounts if the rise of the currency pair continues to spark upwards as nervous financial houses suffer ‘panic’.
Sustaining These New Heights may look Difficult, but the USD/INR may Remain Stubborn
Traders need to understand the vast amount of volatility in the USD/INR and Forex today.Traders brave enough to trade are urged to use entry orders and practice full risk management.
While there is a chance the USD/INR may remain highly priced, it is also possible a sea of volatility creates dangerous price action waves over the next few days. It is likely the Reserve Bank of India will acknowledge it is taking action in the Indian Rupee to try and stem the currency’s loss of value, but this could turn into a brutal game. Speculators need to be very careful near term.
USD/INR Short Term Outlook:
Current Resistance: 81.6000
Current Support: 81.5300
High Target: 81.6800
Low Target: 81.4800