USDINR closes below its opening price unable to hold early session gains
US Dollar/Indian Rupee (USDINR) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
USDINR finished Wednesday at 73.5280 losing 480 pips (-0.07%). Trading 1575 pips higher after the open, the pair was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (USDINR as at Sep 16, 2020):
Wednesday's trading range has been 3190 pips (0.43%), that's far below the last trading month's daily average range of 5201 pips. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for USDINR. Prices continued to consolidate within a tight trading range between 73.2215 and 73.7475 where it has been caught now for the last three trading days.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
After spiking up to 73.7475 during the day, USD/INR found resistance at the 20-day moving average at 73.6478. After having been unable to move above 73.7095 in the prior session, the currency ran into sellers again around the same price level today, failing to move higher than 73.7475. The last time this happened on Monday, USDINR actually gained 0.28% on the following trading day.
Though the market is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the close-by swing high at 73.9265 where further buy stops might get activated. Selling could accelerate should prices move below the nearby swing low at 73.2215 where further sell stops might 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 High" stand out. Although it is usually interpreted as neutral, it has actually shown to be bearish for USD/INR. Out of 860 times, USDINR closed lower 52.56% of the time on the next trading day after the market condition occurred.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.61% and NZDUSD closing 0.27% higher. On the flipside the worst performers have been USDJPY closing -0.47% lower and EURUSD losing -0.25%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPPLN surging 0.81% and ZARJPY closing 0.78% higher. The worst performers of the day have been EURZAR tanking -1.42% and CHFZAR closing -1.28% lower. Read more