Technical Analysis

Daily Rupee call: Buy on declines with stop-loss at 71.7

Akhil Nallamuthu BL Research Bureau | Updated on December 05, 2019 Published on December 05, 2019

The rupee (INR) strengthened on Wednesday and it broke out of the resistance at 71.6 against the dollar (USD), opening the door for further appreciation. After registering an intraday low of 71.81 yesterday, the domestic currency gained throughout the session and closed at 71.53.

Since the rupee has broken out of the range, it will most likely appreciate. On the upside, it will face resistance at 71.4 and 71.2. However, if the breakout fails and the rupee declines, 71.6 will act as a strong support, below which the support is at 71.88.

After declining sharply, the dollar index rebounded overnight. However, the index closed below the support at 97.67, increasing the chances for further weakening. Currently trading at 97.5, it has a support at 97.4, from where it rebounded yesterday. Hence, that level will be important. Below 97.4, the support is at 97. On the other hand, if the index rises it will face hindrance at 97.67, above which the resistance is at 98.

The rupee has opened at 71.48 today against the previous close of 71.53. As the Indian currency has breached the key resistance at 71.6, it can be approached with a bullish bias. Traders can thus initiate long positions on dips with 71.7 as stop-loss.

Supports: 71.6 and 71.88

Resistances: 71.4 and 71.2

Published on December 05, 2019
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