Rupee Losing It's Ground

The Dollar Rupee currency pair has been boring for the most part of the year gone by. The price has been moving in a tight range, refusing to let go of 75.50 on the upside and 72.20 on the downside. For months we've been doing absolutely nothing but consolidating. In the process, of course, we've made four attempts to break out and three attempts to break down.

Looks like one side won. And this time, we could also say the majority wins, because we have a breakout in the USDINR pair. Since the USD is in the numerator, this means that the Rupee is declining. It's important to keep that in mind.

Take a look at the chart below.

The price broke out above the level of 75.50, making its way into this territory after June 2020. For those trading this currency pair, it becomes important to observe the next levels that will be crucial in this move.

We'd like to be long USDINR as long as the price is above the level of 75.50, with a target close to 76.70. While that is the first target to track, a strong move can take this currency pair towards 78.20 in the weeks and months ahead.

The price move here has come after a long consolidation period. Generally, these moves are explosive in nature since the price struggles to move past a level for quite some time and then bursts through it eventually.

What is important to note is how comfortably the price sustains above 75.50. However, we have seen this currency pair consolidate and break out like it did in 2018-2020. This could very well be just another case of a similar move.

Do you trade the USDINR pair?

Thanks for reading and please let us know if you have any questions.

Allstarcharts Team