Flirts with 23.6% of the Fibonacci level, close to the 73.70-65 region

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The pair USD/INR it came under heavy selling pressure on Tuesday and moved away from the nearly one-month highs set in the previous session. The pair faced rejection near resistance marked by a four-month downtrend line and, for now, it appears to have stalled its upward trajectory seen over the past two weeks or so.

The USD / INR pair has now retreated to the Fibonacci level of 23.6% from the recent drop of 76.52-72.76. Meanwhile, technical indicators on the daily chart remain in bullish territory and support prospects for some falling buying to emerge at lower levels, justifying caution from aggressive bearish traders.

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Therefore, any subsequent decline could be seen as an opportunity to initiate new bullish positions. and remain limited near the horizontal support at 73.25. That said, some subsequent selling could drag the USD / INR pair back below 73.00, to retest the recent swing lows, around the 72.75 region.

On the other hand, the 74.00-74.10 region (downtrend line) could continue to act as a stiff resistance. This is closely followed by the 38.2% Fibonacci level, around the 74.20 region, and the very important 200-day SMA, near the 74.35-40 zone. A sustained move further should pave the way for additional short-term gains.

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The USD / INR pair could then aim to break through intermediate resistance near the 74.65 region (50% of the Fibonacci level) before finally climbing to the key psychological level of 75.00. The latter coincides with the 61.8% Fibonacci level and could keep any further gains for the pair limited, at least for now.

Daily chart

Credits: Forex Street

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