Any move above 76.70 can trigger buying again and a target of 77.75 and 77.75 can be achieved gradually in the medium term.
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Mild profit-booking was witnessed in USD/INR in the week gone by after the currency paid broke out of a bullish continuation pattern.
Instead of follow-up buying action, the bulls choose to book profit at higher levels, which eventually placed the currency pair back in the sideways zone but in a bullish territory. Dip of 0.30 paisa was registered in the currency pair on a weekly basis and it closed at 76.270 on April 24.
Initial signs of maturity of a short-term correction seemed to be shaping up in initial trading hours on April 28.
Mild loss of momentum can be witnessed but the bullish bias is still intact and reiteration of an uptrend can be expected again after a small phase of consolidation.
Medium-term moving averages are still trading with the positive curve, which will continue to provide cushion to the prices on every dip.
Short period stochastic has bounced back from the support area, with a green candle suggesting that a mild correction could be abated in an upcoming trading session and the bulls may get back into the game again after mild consolidation.
Though the pace of up move could see loss of strength and upside could be gradual as RSI has made the range shift from the bullish zone to sideways zone.
Momentum indicators act as a speedometer of a market and gauge the pace of an up move or fall.
At the current juncture, it’s indicating that a further up move can be expected after a mild consolidation. Trend line support indicates that short-term base is intact at 75.30 and a dip above this can be used as a buying opportunity.
Volatility divergence has been witnessed in intraday charts, where RSI has also bounced back from the important support levels. Even in 15 minutes and hourly charts, prices are trading above 20-period moving average.
Any move above 76.70 can trigger buying again and a target of 77.75 and 77.75 can be achieved gradually in the medium term, but the trading range for the upcoming week is likely to be 75.80-77.Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.