The USD/INR was able to touch the 82.0000 level in yesterday’s trading. The bullish trajectory seen in the USD/INR currency pair was fast in September and its results mirrored global Forex conditions which were extremely volatile. While the month of October is unlikely to see a repeat of the past few weeks of trading, speculators need to remain focused because chaotic conditions are likely to continue.
USD/INR is trading within Record Territory and the Long Term Bullish Trend is Intact
While many traders may perceive the USD/INR as being overbought, the simple truth is that until a sustained reversal is able to be achieved that the bullish trend remains in control. Technically traders of the USD/INR may feel the historic highs are overdone, but many questions regarding ‘true value’ are still factoring into the heightened nervousness in financial markets which are causing a rush to buy the USD/INR. The U.S Federal Reserve raised its interest rate in September which was expected, but its strong hawkish rhetoric saying more hikes are coming surprised many which helped fuel the upwards momentum of the USD/INR.
- Choppy conditions are likely in the USD/INR in the coming weeks as the new higher price range gets tested. Risk management will be essential for USD/INR traders.
- Reversals lower may be seen as attractive places to wager on bullish price action in the USD/INR re-emerging until the long term upwards trend vanishes, but traders need to be careful they do not get whipsawed by violent conditions.
September’s Price Velocity is Unlikely in October in the USD/INR, But this Doesn’t Mean it is Safe
The price velocity upwards of the USD/INR the past month was astonishing. On the 22nd of September the USD/INR catapulted starting from a mark of nearly 80.1500. By the end of the same day the USD/INR was trading above the 81.0000 mark and its value was not only sustained, but continued to move higher.
While it is logical technically to expect a pullback, meaning a downturn should naturally be displayed; support levels continue to prove durable. Yes, the move upwards was like a rocket ride, but the question is if the new record highs in the USD/INR are going to keep being demonstrated or if equilibrium is going to be found soon. Traders need to remain careful, because more chaos in Forex in the month of October is likely.
USD/INR Outlook for October 2022:
Speculative price range for USD/INR is 80.1700 to 82.6500
Traders who seek to sell the USD/INR should probably be looking for quick hitting trades and not be overly ambitious regarding their outlook for downturns. While it is true the USD/INR gained an astonishing amount of value the past week, it doesn’t necessarily mean a strong reversal lower has to happen now. It might, but counting on the same amount of speed downwards may be wishful thinking.
If the 81.6500 support level were to falter, this could mean an additional leg down towards the 81.4000 could be seen. A move to the 81.2000 level below would be a signal selling pressure is solid. However, traders who believe the 80.8000 levels and lower will suddenly reappear should be willing to actually cash in profitable selling positions if they are lucky enough to traverse a successful bearish track of trading.
Looking for additional upwards momentum in the USD/INR may feel like it is asking too much. However, the month of September started with the USD/INR trading near the 79.3000 ratio. While it is unlikely the USD/INR will burst extremely higher in the coming weeks, many people didn’t think the 82.0000 was going to be seen yesterday, when September began. The results of the price action have been historic in the USD/INR regarding upwards mobility. Many Forex pairs have achieved notable values. Traders looking for additional upside cannot be faulted; the bullish trend has certainly been strong. Traders who are buyers should not be overly ambitious as they pursue upwards momentum, using solid risk management and take profit orders remains important.
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