The USD/INR is trading near the 82.7600 mark as of this writing. November is about to begin and the month of October produced another record high for the USD/INR, as the currency pair has sustained its long-term bullish trend. On the 20th of October the USD/INR actually climbed above the 83.2700 level momentarily. After achieving this height the USD/INR did reverse lower and on the 26th of October a low was recorded near the 81.9000 vicinity.
Support Levels for the USD/INR continue to Move Upwards Incrementally
Speculators who are in favor of selling the USD/INR based on the notion the currency pair has been overbought are likely having a rough time trying to produce profits. Certainly reversals have been produced, but the USD/INR continues to incrementally show an ability to create higher support levels. The long-term bullish trend of the USD/INR mirrors many other emerging market currencies.
After having traded above the 83.2700 mark in the third week of October, the Forex pair was met with stiff selling, but support held firm slightly below the 82.0000 ratio and the reversal upwards afterwards has demonstrated the ability of the USD/INR to maintain an upward price ratio.
- If support levels are maintained above the 82.5000 near-term this may indicate the higher price range of the USD/INR will continue to be stubborn.
- Growing sentiment among financial houses may feel the U.S Federal Reserve is going to ‘soften’ its hawkish rhetoric, but nervous conditions remain and the USD/INR remains within a lofty value realm. The U.S Federal Reserve announcements will come soon.
Speculators may be tempted to sell the USD/INR at these Heights, but Caution is Critical
As the month of November begins, traders may believe the heights of the bullish trend in the USD/INR have been demonstrated. However, traders who feel justified to be sellers of the currency pair need to practice strict risk taking tactics. Nervous global markets continue to play havoc.
The U.S Federal Reserve’s interest rate pronouncements this coming Wednesday will create fast market conditions. An expected hike of 0.75% has been forecasted, analysts will need to see if this is confirmed. More importantly perhaps is the outlook the U.S Fed will also issue, and if the central bank will signal it is going to pause it hawkish policy until more data is seen the coming next few months. The USD/INR is certain to react to this news like all of Forex.
USD/INR Outlook for November 2022:
Speculative price range for USD/INR is 81.7490 to 83.7990
The near term will likely remain rather skittish and the ability of the USD/INR to remain within sight of the 82.7500 realm should be watched. Traders will likely face plenty of nervous conditions over the next two days and the 82.5000 to 82.2500 ratios are likely to hold as support. But as the U.S Fed gets ready to make its announcement on interest rates, the USD/INR will turn very volatile, particularly because of the heights the currency pair is now trading. If the U.S Fed signals it is going to slow down its hawkish policy over the next couple of months, this could see the USD/INR test support levels and even perhaps the 82.0000 to 81.7400 levels below quickly.
However, if the Fed holds to its hawkish policy and does issue a 0.75% increase and says it remains committed to its inflationary outlook, this would likely create another test of highs for the USD/INR. The old adage of buy the rumor and sell the fact is often heard in trading, but because clarity is lacking, the next few days of trading is certain to cause plenty of whipsaw movement in the USD/INR. Cautious traders may want to remain spectators instead of speculators early this week until the U.S Fed acts. If the 83.0000 level is seen after the U.S Fed raises interest rates on November the 2nd, it may be a sign the bullish trend is not over.
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