Technical Analysis

Rupee: Approach with bullish bias

Akhil Nallamuthu | | Updated on: May 08, 2020
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Today, the rupee (INR) has opened with a gain of about 0.5 per cent against the dollar (USD). It has begun the session at 75.44 versus its previous close of 75.76. Currently trading at 75.3, the domestic unit has so far lost about 5.5 per cent for the year against the dollar.

Further rally will face a hindrance at 75.2 above which it can test the resistance at 75. But if the local currency gives up the gain and declines, it will find support at 75.6. Below that level is the support band between 75.9 and 76.

As per the available information with National Securities Depository Limited (NSDL), the Foreign Portfolio Investments (FPI) have net sold ₹1080 crore (equity and debt combined) so far in the current month.

Dollar index:

The dollar index is hovering around the important level of 100. But as it can be observed in the daily chart, the index continues to trade in a range between 98.8 and 100.9. So, until either of these levels are breached, the next leg of trend will be uncertain.

Trade strategy:

The rupee, after opening with a positive bias, hints at a considerable bullish momentum. Moreover, it has gone past the resistance at 75.6. Thus, traders can buy rupee on intraday declines with stop-loss at 75.5.

Supports: 75.44 and 75.6

Resistances: 75.2 and 75

Published on May 08, 2020

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