USD/INR Forecast: Forming A Double Top Against Repeat
Date
12/21/2022 2:29:41 PM
(MENAFN- Daily Forex) The usd/inr has gone back and forth during the last couple of trading sessions, and the Tuesday session was no different. We initially tried to rally a bit, but then gave back some of the gains. It appears that the Indian rupee is settling right around the ₹83 levels against the US dollar, and that could be the beginning of a pullback. After all, this is a market that had gone straight up for quite some time, and of course, we have the 50-Day level underneath hanging around the ₹82 levels and rising.
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Keep in mind that we could be forming a double top, and that will have a lot of technical traders out there excited about trying to short this pair. The US dollar has been very noisy, as traders try to figure out what it is Jerome how is going to do, and of course, what it is that means to emerge markets such as India. I don't necessarily think that the US dollar is done rallying, but we are heading into the holiday season, so it will take a lot of liquidity out of the market quite frankly is always liquid, to begin with. Because of this, I think we got a situation that the market will continue to find buyers given enough time, but if we were to break down below the ₹81 levels, then you may have a situation we have a deeper correction.Noisy Conditions Expected
Alternatively, if we break above the ₹83 level on a daily close, then it's possible that we could go looking to the ₹84 levels, and then eventually the ₹85 level. It would not surprise me at all to see that happen sometime next month, but in the next 2 weeks, I think it's probably asking quite a bit unless of course there has been some type of surprise news announcement, which would have people freaking out in a thin market.
Very noisy conditions could be expected, but at this point, I think you need to be very cautious with your position size therefore you can protect your account because the moves can be dangerous, but we should see quite a bit more in the way of certainty in January. Ultimately, we could be trying to force some type of range as well, perhaps we are just at the top of it?
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