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Propped up by the support band between 71.88 and 72, the rupee (INR) gained against the dollar (USD) on Wednesday. It ended the session at 71.66 versus its previous close of 71.88. On the upside, 71.65 serves as a resistance. The domestic currency might oscillate between 71.65 and 72 for quite some time.
As long as the rupee stays above 72, the chances for further weakness are low. Hence, from the trading perspective, one can go long whenever the rupee slides to that level.
Dollar index
The dollar index looks to have stabilised around the 99 level, where it has consolidated for the past two trading sessions. If the index extends the corrective decline, it could find support at 98.7 and 98.5. But if the index regains traction, it could rise to the crucial level of 100, which is a substantial resistance.
Trade strategy
The rupee seems to have a positive bias but faces stiff resistance at 71.65. For intra-day, traders can either buy the rupee with tight stop-loss if it declines to 71.9 or buy rupee with stop-loss at 71.75, if it breaks above 71.6.
Supports: 71.88 and 72
Resistances: 71.65 and 71.5
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