USDINR licks its wound at the lowest levels in a month, snaps three-day downtrend. (Pivot Orderbook analysis)

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• USDINR licks its wound at the lowest levels in a month, snaps three-day downtrend.
• Firmer yields, covid woes from China test bears even as Fed concerns weigh on prices.
• Softer oil price adds strength to the bearish bias amid an off in Indian markets.

The pair currently trades last at 81.922.

The previous day high was 82.4096 while the previous day low was 81.7549. The daily 38.2% Fib levels comes at 82.005, expected to provide resistance. Similarly, the daily 61.8% fib level is at 82.1595, expected to provide resistance.

USDINR picks up bids to regain 82.00 while paring recent losses at the monthly low during Tuesday’s Asian session. In doing so, the Indian Rupee (INR) pair prints the first daily gains in four by printing 81.92 the figure at the latest.

The biggest jump in China’s covid cases since April and the market’s anxiety ahead of the US midterm elections seem to underpin the USDINR pair’s recent rebound. Also keeping the quote firmer could be the holiday in India due to Guru Nanak Jayanti.

It should be noted that the recently downbeat prices of WTI crude oil, down 0.35% to $91.55 by the press time, also weigh on the USDINR prices due to India’s reliance on energy imports and record current account deficit.

However, the looming concerns over the US Federal Reserve’s (Fed) pivot, as well as the recently mixed comments from the Fed officials, keep the US dollar bears hopeful. It’s worth noting that the Fedspeak has recently shifted towards the concerns of pivot than the further rate hikes, which in turn suggests easy interest rate lifts and weigh on the greenback.

Elsewhere, a light calendar and the market’s wait for Thursday’s US Consumer Price Index (CPI) for October, as well as recently firmer US inflation expectations, challenge the USDINR bears. That said, the US inflation precursors, as per the 10-year and 5-year breakeven inflation rates per the St. Louis Federal Reserve (FRED) data, print one-week highs of 2.53% and 2.61% according to the latest readings.

Amid these plays, the US Treasury yields are firmer and stock futures remain indecisive but the US Dollar Index (DXY) rebounds from a one-week low.

Looking forward, a light calendar and off in India could test USDINR traders and may keep the latest corrective bounce on the table.

The USDINR pair’s first daily closing below the 21-day EMA, close to 82.25, in nearly two months keeps bears hopeful of testing the 50-day EMA support level surrounding 81.55.

Technical Levels: Supports and Resistances

USDINR currently trading at 81.922 at the time of writing. Pair opened at 81.7687 and is trading with a change of 0.19% % .

The pair is trading below its 20 Daily moving average @ 82.4454, above its 50 Daily moving average @ 81.3228 , above its 100 Daily moving average @ 80.3502 and above its 200 Daily moving average @ 78.3888

The previous day high was 82.4096 while the previous day low was 81.7549. The daily 38.2% Fib levels comes at 82.005, expected to provide resistance. Similarly, the daily 61.8% fib level is at 82.1595, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 81.5459, 81.3231, 80.8912
• Pivot resistance is noted at 82.2005, 82.6324, 82.8552

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