USD/INR Analysis Today - 19/12: Hits New Highs (Chart)

(MENAFN- Daily Forex) The USD/INR jumped to new record high values early today and the 85.0000 ratio has been penetrated making this level a worthwhile consideration for speculators and financial institutions.

The USD/INR has traded over the 85.0000 level in early Forex action today. While the Reserve bank of India has made it publicly known they are in control of the exchange rate between the USD and Indian Rupee, it appears global market forces are having an effect on the value of the currency pair too.

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Major currencies paired against the USD have lost plenty of value over the past three months and the Indian Rupee has suffered a decline in value too. Because the USD/INR is largely perceived as being under the strict care of the RBI the move higher in the currency pair may be catching some large commercial traders off guard. However, it appears the penetration of the 84.0000 level which took place in the second week of October this year, and today's price action above 85.0000 is viewed as manageable by the Reserve Bank of India.85.0000 as a New Higher Ratio and Near-Term Speculation

Retail traders who have the ability to speculate on the USD/INR may believe because of natural bias that the currency pair is overbought. However, the simple acknowledgement of the higher price action and consideration that the Reserve Bank of India is keeping a watchful eye on Forex means the current values may be an acceptable level. Financial institutions are not likely betting on lower values to become sustained in the near-term, and day traders should not be either.

Global nervousness in Forex has been rampant the past few months. The price action of the USD/INR has been in a bullish trend since March of 2024 when the currency pair was challenging the 82.6200 ratio for short duration. The ability of the USD/INR to climb in value and create more price velocity upwards since late September actually matches the momentum of many major currencies as they have lost value against the USD with a greater frequency Global Sentiment and the USD/INR Outlook

The USD/INR bullish trend is unlikely to suddenly reverse in a sustained manner in the near-term. Global Forex sentiment was dealt more nervous when the U.S Federal Reserve sounded surprisingly hawkish regarding inflation yesterday to many analysts.

• The Fed did cut their interest rate by 0.25, but they made it rather clear that future rate cuts will be hard fought in the mid-term.
• This sets the table for the USD/INR to actually sustain its higher values and allow the Reserve Bank of India to continue to allow an incremental increase of the currency pair.
• Day traders who do want to pursue the USD/INR need to also consider holiday trading volumes will become light after tomorrow and past the New Year.

USD/INR Short Term Outlook:

Current Resistance: 85.0900

Current Support: 85.0010

High Target: 85.1200

Low Target: 84.9950

EURUSD Chart by TradingView

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