- The USD/INR is around 83.4200 as of this writing.
- The range of the currency pair has been between 83.1150 and 83.7175 during the month of May.
- On the surface this may look like a normal price range, but the Indian government has increasingly cracked down on retail speculation of the Indian Rupee in the nation.
- In order for ordinary Indian Forex traders to wager on the direction of the USD/INR they now essentially have to look for offshore regulated trading accounts.
India has created a stronger grip on the USD/INR likely as an effort to try and control its economy. However, the move has critics which say that if the Indian Rupee is not allowed to ‘float’ according to Forex market demand and supply, that it restricts the ability to react to open markets elsewhere and limits free enterprise. The USD/INR did hit a low around 82.6190 on the 7th and 8th of March, but then then began to creep incrementally higher again.
USD/INR Dominant Price Range in April and the Potential of a Mirror in May
The dominant value range for the USD/INR has largely been between 83.2000 and 83.5600 in April. And if traders take a closer technical look the USD/INR could be said to mostly stay within the 83.2500 to 83.5000 framework the past handful of weeks. Retail traders who are trying to take advantage of this range certainly need to look at technical charts and have the patience to wait out cyclical changes of value.
However the news of the increased supervision of the Forex market in India shouldn’t have been too big a surprise. The USD/INR has been trading within a tight value band compared to the other major currencies teamed against the USD for a long time. The Reserve Bank of India has not hidden that it has an agenda and wants to keep the INR within a rather manageable range. The problem for speculators is that there is a lack of correlation many times compared to global Forex in what should predominantly be a USD centric world due the USD being the world’s reserve currency, which should create natural give and take.
USD/INR and Speculative Wagers to Sudden Price Reactions
If a trader does have the capability to trade the USD/INR they should certainly keep an eye on technical trends and understand that sudden price velocity can emerge without much notice. Charts of one and five day intervals are crucial to try and gauge the behavioral sentiment of the Reserve Bank of India. When the USD/INR climbed to the 83.7200 vicinity and then began to trade lower it was not a surprise, what would have been a surprise would have been a move that allowed the currency pair to climb even higher.
- Intriguingly since the 25th of April the USD/INR has climbed higher, this as the USD has actually become weaker against many other major currencies.
- Trying to figure out and know when the USD/INR is going to trade in a stronger direction now means that a speculator would have to have inside knowledge.
- But knowing what major corporations intend on doing via their Forex as they transact money for commercial enterprises is nearly impossible.
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USD/INR Outlook for May 2024
Speculative price range for USD/INR is 83.1690 to 83.6055
Yes, day traders can still participate in the USD/INR, but for those living inside of India and looking to speculate on the currency pair it will mean opening an account outside of India in places like Dubai or Singapore. Looking for direction in the USD/INR is largely gambling on sentiment created by technical interpretation. The use of strict leverage and risk taking tactics is highly encouraged.
The U.S Federal Reserve will issue its FOMC Statement this Wednesday, but no changes to the Federal Funds Rate will take place. The reason this is largely known is because the U.S is mostly transparent regarding its monetary policy management. The USD/INR has seen a slight climb in price momentum develop over the past handful of days and is trading within the middle ground of its one month technical charts – and perhaps that is exactly what the Reserve Bank of India wants.
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