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USDINR – Weekly Outlook & Analysis for 19th August 2021

USDINR Forecast & Technical Analysis for Forex


The Bullish run of USDINR on the forex brokers has slowed down in July because of the new variant of the coronavirus that is threatening the recovery process and progress of the global economy. 

Fundamentals: India

The Indian economy is on the road to recovery from the second wave of the virus, which led to another lockdown within the country. Indian’s business resumption index crossed the 100-level mark for the first time since the coronavirus pandemic hits Indian’s economy in 2020. Previously, when the pandemic was at its peak, Nomura India’s Business Resumption Index fell to a low of 60.4. 

It took the NIBRI about 10 months to hit the 100 marks when the first wave happened, but less than 3 months after the second wave almost shut down the progress made according to Nomura India.

There is optimism in the air as the second lockdowns imposed by the various states were not as harsh as the national lockdown of last year. The 2021-22 GDP growth forecast is 10.4% above some economist’s forecasts, which is 9.5%. However, the third wave is a threat to the recovery state of the Indian economy.

US Fundamentals

FOMC Fed chairperson Speaks

Another FOMC meeting will come up during the new week to access the health of the economy and to see the level of inflation rate affecting the economic activities. The monetary policy meeting will take place for some days and at the end of the meeting decisions will be reached. 

Jerome Powell’s speech will come earlier before the meeting. We expect it to take place 3 weeks after they announced the Federal Fund rate. A hawkish statement from the FOMC is good for the US currency, but a dovish sentient will boost the Indian rupee.

At the release of the minutes of the meeting, they will price the interest rates into the market. 

They focused the meeting on the future of the economy and how the FOMC will be directing the future of the economy and its activities. The voting process and arrival of the interest rate is also published in the press statement.

USDINR Price Analysis

USDINR Monthly Chart: Slowing within Support Zone

USDINR monthly chart - 18th August 2021

Monthly Resistance Levels: 76.45, 75.51, 75.00

Monthly Support Levels: 72.12, 72.3

Market participants and online brokers have not seen volatility on the forex platform in this recent month, just like the previous month before the market closed. The Bulls need the price to breakout above the 75.00 level for a significant take-over signature before the upward trend continues in the market.

The Monthly chart on the forex platform is bullish while the market structure shows that price is in its corrective stage and in a bullish channel. If the price should close below the 72 support levels, we may say that the trend has changed into a bearish market and the Indian rupee will make progress against the US dollar.

USDINR: Weekly Chart

USDINR weekly chart - 18th August 2021


Weekly Resistance Levels: 75.70, 75.00

Weekly Support Levels: 72.2746, 72.1935, 73.30

The bullish online brokers were able to push the USDINR pair from the support zones of 72.19 and 72.27 region to the 75.00 resistance zones. For the past weeks, the price has not gone above the zones because the volatility is low in the forex market. For the Bulls, to dominate the market, they must take out the high of the market.

However, the Bears are not having any advantage in the forex market as of now, but a close below the 72 zones will take the price lower on the week time frame. The online brokers have to wait for the price of the pair to have a definite direction.

USDINR Daily Projections: Breakout of Descending Triangle

Daily Resistance Levels:  75.99, 75.00

Daily Support Levels: 72.5, 73.33, 74.00

The Bulls have enjoyed some bullish runs since June on the daily chart. However, the pair went into a range when the price hit the 75.00 level. The pair has been ranging from the high of 75.00 and the support of 74.00.

The price needs to close either above the 75.00 levels for the bulls to continue their upward trend. If the price closes below the 74.00 levels, we shall see the price of the pair dropping to 73.33 or lower.

Bullish Scenario:

The online brokers will need to see the USDINR pair close above 75.00 to sustain the bullish run, having closed above the 73.33 some days back. The bulls will need strong fundamentals from the US economy to break above the resistance zone.

Bearish Scenario:

The Bearish Scenario is likely to move the market if the sellers can close below the 74.00 zones. We shall see the Indian rupee dominate the forex market to take the price to the support level of 73.33 or lower.

Conclusion and Projection

The USDINR pair is slow and it is in a range on the daily time frame. Online brokers and other participants will have to be patient by watching the reaction of price on the forex platform to ascertain the actual bias of the market forces as key news from the FOMC may like influence the Indian rupee.


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