#USDINR @ 79.6100 takes offers to renew one-week low, ignores the previous day’s corrective pullback. (Pivot Orderbook analysis)

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• USD/INR takes offers to renew one-week low, ignores the previous day’s corrective pullback.
• Firmer sentiment in Asia underpins bullish bias for Rupee, broad risk-on mood, sluggish yields weigh on USD.
• Recovery in oil prices, hawkish Fedspeak could restrict downside moves amid a light calendar.

The pair currently trades last at 79.6100.

The previous day high was 79.962 while the previous day low was 79.6122. The daily 38.2% Fib levels comes at 79.8284, expected to provide resistance. Similarly, the daily 61.8% fib level is at 79.7458, expected to provide resistance.

USD/INR takes offers to refresh the weekly low around 79.57 during the initial hour of the Indian trading session on Friday. In doing so, the Indian rupee (INR) pair cheers the broad US dollar weakness, as well as upbeat sentiment in Asia.

That said, the US Dollar Index (DXY) prints the biggest daily loss in a month while refreshing the one-week bottom around 108.75 by the press time. In doing so, the greenback gauge fails to cheer hawkish comments from Fed Chair Jerome Powell, published the previous day, while justifying the market’s firmer sentiment.

Comments from US Treasury Secretary Janet Yellen, signaling likely positive change in the US-China trade ties, seemed to have helped the market sentiment of late. Recently firmer US data and hopes that the global central bankers will be able to overcome inflation-led blow with a holistic approach and higher rates also seemed to have favored the market’s mood. On the contrary, the Wall Street Journal’s (WSJ) piece challenges the optimism a bit by suggesting further hardships for China’s technology companies.

Fed Chairman Jerome Powell said on Thursday that they need to act forthrightly and strongly on inflation, as reported by Reuters. “We think by our policy moves we will be able to put growth below trend and get labor market back into better balance,” added Fed’s Powell. On the same line was Chicago Fed Chairman Charles Evans who favored a 0.75% rate hike for September. Also hawkish was the European Central Bank (ECB) which announced a 0.75% rate hike and President Christine Lagarde showed readiness for more such moves to tame inflation.

In addition to the hawkish central bank plays, firmer oil prices also challenge the USD/INR bears due to India’s heavy reliance on oil imports. That said, WTI crude oil prices rise 1.25% to $83.35 during the two-day rebound from the eight-month low.

Amid these plays, the US 10-year Treasury yields remain sidelined near 3.32%, after a positive day, whereas the S&P 500 Futures traces Wall Street’s gains around 4,010. It should be noted that India’s BSE Sensex also rises 0.50% to please bulls.

Moving on, the last lot of Fedspeak ahead of the blackout period, starting from this weekend, will be important to watch for USD/INR traders for clear directions.

A clear downside break of the 50-DMA, around 79.65 by the press time, directs USD/INR bears towards the monthly low marked in the last week near 79.28.

Technical Levels: Supports and Resistances

USDINR currently trading at 79.5736 at the time of writing. Pair opened at 79.7085 and is trading with a change of -0.17% % .

The pair is trading below its 20 Daily moving average @ 79.733, below its 50 Daily moving average @ 79.574 , above its 100 Daily moving average @ 78.5648 and above its 200 Daily moving average @ 76.9813

The previous day high was 79.962 while the previous day low was 79.6122. The daily 38.2% Fib levels comes at 79.8284, expected to provide resistance. Similarly, the daily 61.8% fib level is at 79.7458, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 79.5598, 79.411, 79.2099
• Pivot resistance is noted at 79.9096, 80.1107, 80.2595

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