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USD/INR – Weekly Outlook for September 19 2019

USDINR Forecast & Technical Analysis

Introduction

The Indian Rupee has not been able to sustain a full recovery of its rates as shown on major IQOption India platforms. This week we’ll be analyzing the chart patterns responsible for a price recoil, as well as interesting news events driving the USDINR currency pair.

India’s Fundamentals 

India WPI (Wholesale Price Index) Inflation 

The Indian WPI (Wholesale Price Index) measures the difference in the price of goods traded by wholesalers.

The higher the trade value, the stronger its effect on consumer inflation. 

A reading higher than expected means a positive or bullish sentiment for the INR, while a reading lower than anticipated should be considered bearish or negative for the currency.

Data released recently on August 4 shows the actual reading to be 1.08%, while the previous value was 2.02%. Forecast value was pegged at 1.93%, suggesting a bearish inclination for the Indian Rupee.

U.S. Housing Starts MoM

Housing Starts is an indicator that considers the variation in the volume of new constructions initiated. The building industry is usually among the first industries to move into recession when an economic decline is recorded, but also the first to recover as conditions get better. 

A reading higher than expected means a positive or bullish sentiment for the USD, while a reading lower than anticipated should be considered bearish or negative for the USD

Recent data released shows the actual reading to be -4.0%, while the previous value was -1.8%, suggesting a bearish trend for the currency.

USDINR Techincal Analysis

USDINR Long term Projection: Bullish Swing

USDINR: Weekly Chart

USDINR outlook - weekly chart - Sept 19 2019

The USD to INR exchange rate increased by roughly 3.9% after a bullish engulfing price pattern on 26 July. We noticed a decline in bullish momentum as the price closed bearish towards the end of August, and later a bearish signal on September 02 ’19.

A price recoil was effected after the USDINR closed within the support zone (70.726) of the August 12 bullish pattern, threatening to form a bear trap reversal pattern at the close of the current week. If the bear-trap pattern gets triggered, we should lookout for a continuation of the bullish trend on the weekly time frame; otherwise, the bears may take over.

USDINR Medium Term Projections: Price Correction 

USDINR Daily Chart

USDINR outlook - daily chart - Sept 19 2019

From the daily time frame, we get to see how the last two weeks wind up in bearish closing bars as the price chart formed higher highs compared to the lower highs formed by the RSI oscillator.

An opposite hidden bullish divergence pattern signaled at the closing bar of September 15, and 16 turn the earlier price decline into a mere correction of the USD gains.

USDINR 4HR Chart

A view from the 4hout time frame offers excellent low-risk short selling entry orders as the bears break below significant support on September 03 and 11 for a combined 1.9% from the first price slump.

Bullish activities picked up on September 16 from a break of resistance 71.034 as the price grew by about 0.8% from the breakout point before failing to bearish pressure from a hidden bearish divergence setup at press time.

Conclusion and Projection

The rollercoaster formation of bullish and bearish swings may persist as the days go by. We suggest traders be on a lookout for a combination of technical patterns taking advantage of swing trading opportunities to buy or sell the Indian Rupee.

 



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