- The US dollar has fallen significantly during the course of the trading session on Wednesday, as the ₹87.50 level has offered a bit too much in the way of resistance for the market to continue to go higher.
- The pull back during the day on Wednesday was somewhat ugly, but it also is worth noting that the market was a little overdone during the last couple of sessions, so I think we’ve got a situation where it makes sense that the market would have to drop.
- Furthermore, the ₹87.50 level has previously been resistant, so the fact that it acted as resistance again on a that the US dollar lost against almost everything else makes quite a bit of sense.
Ultimately, this is a market that I think is going to continue to be more of a grind than anything else and if we do in fact continue to see a lot of concerns when it comes to global economic numbers, then the US dollar will eventually be thought of as a safety currency in the situation. However, during the session on Monday, we have seen the US dollar sell off against almost everything, so the Indian rupee may have gotten a little bit of a helping hand from that general attitude.
Top Forex Brokers
Technical Analysis
The technical analysis for this USD/INR pair still suggest that we probably go higher, but it is worth noting that if we do fall from here and break below the 86.50 level, it is a very negative turn of events, and it could in fact end up being a bit of a “double top” forming. If we break down below that level, we also will be looking at the 50 Day EMA as being blown through.
On the other hand, if we turn around and break above the ₹88 level, it would be a fresh, new high, and it would in fact show that the US dollar is going to destroy most things as far as emerging markets are concerned. I do think that’s a very real possibility, but right now we are in the midst of a significant pullback that needs to be monitored.
Ready to trade our daily Forex analysis? Here’s a list of some of the best forex brokers in India to check out.