USDINR – Weekly Outlook & Analysis for 17th Dec 2021
USDINR Forecast & Technical Analysis for Forex
Introduction
The Bullish momentum on the Indian forex platforms has overturned the seller’s pressure having broken out above the resistance levels of 75.68. The Bulls have been in control for the past weeks and they intend to ride the uptrend to a previous high of 77.00 as of 01 April 2020.
India’s Fundamentals
According to the former Niti Aayog Vice-Chairman Arvind Panagariya, he said that the country needs to be decisive in dealing with the COVID-19 crisis and to conquer it quickly. He sees that the real GDP had crossed the pre-COVID-19 level in the 3rd and 4th quarters of 2020-2021. He thinks that the fundamentals of the economy are sound and it’s good for the Indian rupee.
The Reserve Bank of Indian lowered the growth projection for the country in this current financial year to 9.5% from the previous 10.5% and the World Bank projected a growth of 8.3% for the Indian economy in the year 2021.
Panagariya, a professor of Economics at Columbia University, highlighted the fact that privately-owned investments are picking up in the country
US Fundamentals
USD Industrial Production m/m
The Federal Reserve uses the data as a measurement in ascertaining the change in the total inflation-adjusted value of the products produced by mines, utilities, and manufacturers.
The results are released 16days into the new month. However, the reason why traders, online brokers care about the report is because of the quick reaction in production when there are ups and downs in the business cycle, also there is some level of correlation with consumers’ condition in terms of earnings and the level of employment.
If the factory output is lower than the data expected it is not good for the currency but a higher outcome than the forecast is suitable for the US dollar.
Forecast data is 0.6% while the previous was 1.6%.
USDINR Price Analysis
Monthly Chart Projection: Trades within correction area
Monthly Resistance Levels: 77.020, 75.70
Monthly Support Levels: 72.210, 72.930, 73.85
The resistance zone of 75.70 had rejected the Bulls advancement previously as at last month, online brokers who had long positions opened on the forex platform struggled to trade above the zone. The Bulls surge from the support level of 73.85 as of last month candle gave the push and attract more online brokers on the long position by taking out the recent resistance zone.
However, the bears will wait for the price of the USDINR pair to reach the high of 77.00 and see if the reaction can push back the price before they can dominate the market. Right now, the Indian rupee is weaker than the US dollar on the Forex platform.
Weekly Chart
Weekly Resistance Levels: 77.00, 75.61
Weekly Support Levels: 73.05, 73.93, 72.32
The USDINR pair has shown a bullish momentum leading to the breakout above the previous resistance zones to continue the bullish run on the weekly chart as the pair keeps making higher lows and higher highs. The next resistance area is around the 77.00 that will likely slow down the bull’s rally.
At the moment there is no sign of a bearish swing of the weekly time frame because there is no sign of a reversal pattern on the forex platform. When the price gets to a resistance zone we shall be watching for a double top or bearish engulfing candles.
Daily Projections: Breakout of Descending Triangle
Daily Resistance Levels: 75.13, 75.66, 74.59
Daily Support Levels: 73.85, 74.33
The Indian rupee made some gains against the US dollar when it took the price down from the high of 75.66 to the low of 73.85 some weeks back. A failure swing pattern formed when the support level of 74.33 failed to close below the 73.85 level. This led the Bulls to take the price high and close above 74.59 zones which attracted the long position traders into the market.
If the 75.66 levels are tested and they reject the price we shall see another surge in the days to come, however, if the support fails to hold we might see the sellers dominate the market.
Bullish Scenario:
On the Forex platform, the market is still bullish and online brokers can still hold their position to aim for a 77.00 level of resistance.
Bearish Scenario:
The bears may have a short selling opportunity if the current level can push back the price to the 75.68 level before the buying run continues on the daily time frame.
Conclusion and Projection
The USDINR pair is Bullish on the daily chart, therefore online brokers who have long position running can aim for the 77.00 level of resistance on the Forex platform.
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