The USD/PKR has proved once again that trading the forex pair can be a dangerous affair when you are on the wrong side. The last week has produced a sudden bearish trend and support levels not tested since the middle of June are within sight. However, this is the USD/PKR we are talking about and traders need to examine their perspectives carefully before engaging in a speculative position when they merely want to jump on an existing short term trend.
It isn’t often that a three month chart could be the most important piece of the technical puzzle when considering a short term trade. The USD/PKR’s current price action however suggests a look at a mid-term chart is important today. The Pakistani Rupee doesn’t trade with a great amount of volume or transparency. The USD/PKR clearly moves in a rather mechanical manner and when viewed from the outside appears to steadily produce values which show strong support and resistance ratios which are suspicious.
The current support level the USD/PKR is trading next to is a level which has been tested more than a handful of times since the middle of June. Speculators should acknowledge when the current price values of the Pakistani Rupee has been traversed that it has also produced sharp upward movements which have then tested the highest resistance levels. The 165.5000 to 168.4000 range has been solid for nearly two and half months. Is this about to change?
Speculators may have a hard time convincing themselves a buying position of the USD/PKR is the appropriate action right now, but they should also take into consideration the current price action of the Pakistani Rupee via its long term trading indicates the upside has greater potential. If a trader uses an appropriate buying entry limit order, perhaps near the 165.0000 mark with a stop loss near the 164.0000 juncture, this speculative trade would be difficult to argue against.
The USD/PKR is a dangerous forex pair to trade, but it does offer opportunities for the brave. Yes, buying the US Dollar against the Pakistani Rupee would be going against the one week bearish trend which has suddenly emerged. However, this forex pair operates within a complex manner that is affected by geo-political and domestic economic concerns which produce a rather dynamic price range.
Pakistani Rupee Short Term Outlook:
Current Resistance: 167.5000
Current Support: 165.0000
High Target: 168.5000
Low Target: 164.5000
