The rupee (INR) has begun the session with a gain against the dollar (USD). It has opened at 76.56 versus previous close of 76.86, anticipating stimulus measures from the Reserve Bank of India (RBI). There can be higher volatility on the back of the same.

On Thursday, the rupee witnessed a gap-down open and declined throughout the session. It registered a fresh lifetime low of 76.87 before ending the session at 76.86. It lost about 0.5 per cent yesterday and closed near the lowest point of the day – indicating considerable bearish momentum. A decline from the current level of 76.5 can drag the local currency to 76.85, below which it can drop to 77. On the other hand, if the rupee recovers, it will face hurdles at 76.3 and 76.

The Foreign Portfolio Investments (FPI) turned net sellers yesterday. The outflow stood at ₹2,920 crore (equity and debt combined), weighing on the local currency.

Dollar index:

The dollar index is hovering around the important level of 100. It is stuck between 99 and 100, where the 50-day moving average and 21-day moving average coincides, respectively. The index can be expected to consolidate within these levels for the day.

Trade strategy:

Though the trend has been bearish, if the announcement from the RBI instills positivity, the local currency can rally sharply today. But if it slips below 76.65, the Indian currency might depreciate. Whatsoever, the volatility can be higher today.

The rupee currently trades near 76.5. Traders can either buy the rupee with tight stop-loss if it rallies above 76.4 or traders can sell the rupee with tight stop-loss if it weakens below 76.65. It is recommended to stay on the sidelines until either of these levels are breached.

Supports: 76.65 and 76.85

Resistances: 76.4 and 76

Related Topics
comment COMMENT NOW