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The rupee (INR) was sluggish yesterday and it closed the session at 75.54 versus the previous close of 75.57 against the dollar (USD). Thus, the price range between 75 and 75.6 continues to hold.
Today, the Indian currency opened the session slightly higher at 75.51. Since the exchange rate of USDINR is fluctuating between 75 and 75.6, the rupee might gain on the back of support at 75.6. On the upside, it might face a hindrance at 75.3 and 75.15, whereas a break below 75.6 can trigger a considerable sell-off.
Yesterday, Foreign Portfolio Investors (FPI) were net buyers and net inflows stood at about ₹813 crore (equity and debt combined). This trend is likely to continue as FPIs have been buying considerably since last week. This can raise the demand for the rupee, potentially lifting it against the greenback.
Dollar index
The dollar index closed marginally lower yesterday, extending the downtrend. After registering an intra-day high of 97.07, the index closed at 96.62. On a further decline, it might descend towards its immediate support levels at 96.4 and 96.
Trade strategy
The rupee is hovering around the range bottom of 75.6, which is a considerable support. Hence, traders can go long in rupee with tight stop-loss.
Supports: 75.6 and 75.8
Resistances: 75.3 and 75.15
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