INRUSD stuck within tight trading range
Indian Rupee/US Dollar (INRUSD) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
INRUSD finished Wednesday at 0.013600 gaining 9 pips (0.07%). Trading up to 29 pips lower after the open, the currency managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (INRUSD as at Sep 16, 2020):
Wednesday's trading range has been 59 pips (0.43%), that's far below the last trading month's daily average range of 96 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for INRUSD. Prices continued to consolidate within a tight trading range between 0.013560 and 0.013657 where it has been caught now for the last three trading days.
One bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
After trading as low as 0.013560 during the day, INR/USD found support at the 20-day moving average at 0.013579. After having been unable to move lower than 0.013567 in the prior session, the pair found buyers again around the same price level today at 0.013560. The last time this happened on Monday, INRUSD actually lost -0.28% on the following trading day.
Although the forex pair is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might accelerate should prices move above the close-by swing high at 0.013657 where further buy stops could get activated. Selling might speed up should prices move below the nearby swing low at 0.013527 where further sell stops could get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for INR/USD. Out of 872 times, INRUSD closed higher 52.52% of the time on the next trading day after the market condition occurred.