Technical Analysis

Rupee weak below 75.6

Akhil Nallamuthu, BL Research Bureau | Updated on May 21, 2020 Published on May 21, 2020

According to experts, over the next few years, cash in circulation will grow in line with GDP growth as India is a predominantly cash economy

The rupee (INR) has begun the session at 75.68 versus its previous close of 75.79 against the dollar (USD). On Wednesday, the Indian currency depreciated by 0.2 per cent, ending the session 75.79. There was a negative impact on rupee yesterday as the Foreign Portfolio Investments (FPI) dumped domestic assets. The net outflow of FPIs stood at ₹1,466 crore (equity and debt combined).

If the rupee gains from current level, it will face a hindrance at 75.6. A breakout of that level can take the exchange rate of USDINR to 75.4. But if the local unit weakens, it will find support at 75.8 and 76. A break below that level can intensify sell-off, dragging the rupee to 76.3.

Dollar index

The dollar index closed with a loss for third consecutive day. Today, it has rebounded a bit and is trading at 99.35 after taking support at 99. The index has been oscillating in a sideways trend between 98.8 and 101 and it should breach any of these levels to confirm the next leg of trend.

Trade strategy

As long as the rupee trades below 75.6, it can be bearish. Hence, for intraday, traders can sell rupee with stop-loss at 75.5.

Supports: 75.8 and 76

Resistances: 75.6 and 75.4

Published on May 21, 2020

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
  1. Comments will be moderated by The Hindu Business Line editorial team.
  2. Comments that are abusive, personal, incendiary or irrelevant cannot be published.
  3. Please write complete sentences. Do not type comments in all capital letters, or in all lower case letters, or using abbreviated text. (example: u cannot substitute for you, d is not 'the', n is not 'and').
  4. We may remove hyperlinks within comments.
  5. Please use a genuine email ID and provide your name, to avoid rejection.
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.