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Last Updated : Dec 02, 2019 12:21 PM IST | Source: Moneycontrol.com

USD/INR likely to trade in sideways zone with positive bias

The overall scenario suggesting that ongoing uptrend is again going through the phase of consolidation and bulls are expected to come back in their action.

Moneycontrol Contributor @moneycontrolcom

Rudra Shares and Stock Brokers

As expected, the bulls reclaimed lost ground and the minor dip in USD/INR was bought into. Even though the currency pair has closed with the loss of 42 paise on a weekly basis, the short term base is still intact.

Last week, the fall in prices was arrested at 50-day exponential moving average and formed Bullish Engulfing candlestick pattern at lower levels. Apart from this, the prices have also respected the support range of gap area at 71.10 levels.

Close
The recent breakout in the currency pair could not be sustained at higher levels and prices moved back in the trading range, but the bounce back from lower level suggesting that currency pair could again go sideways in next few trading sessions with positive bias. Prices are trading above all major short term and medium term moving averages where the former has started trading with a positive curve suggesting that bias is still positive.

Image12122019USD/INR (spot) Daily

The new short term base is emerging at 71.10 and currency pair is likely to trade in the range of 71.10 and 72.30 with positive bias in the coming days. RSI on the daily chart is trading in the sideways territory with positive curve and ADX is also suggesting that the uptrend is still intact. On the intraday chart, the currency pair seems to abate its correction. After a decline, the prices are showing the bounce back and trading above the middle line of the Bollinger band.

Trading Strategy

The overall scenario suggests that ongoing uptrend is again going through the phase of consolidation and bulls are expected to come back in their action. In such trading setup, traders can go Long in USD/INR futures at 71.73 and hedge the positions Put Option of 71.25 can be bought simultaneously at 0.0225 of equal quantity. Profit can be booked at higher levels in the range of 73.3 to 72.5.

Disclaimer: The views and investment tips expressed by investment expert on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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First Published on Dec 2, 2019 12:21 pm
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