The Hindu Business Line

Rupee likely to regain strength

-

The rupee has been in a shortterm uptrend since taking support at 71.8 in early February. But after hitting a resistance at 68.53 in mid-March, the currency began to weaken.

The rupee is in a near-term corrective decline. The significan­t support in the band between 69.3 and 69.5 can provide a base for the currency. Taking support from this band, the rupee has the potential to strengthen to 68.5 and 68.3 in the ensuing trading sessions.

Following a weak start, the rupee regained its bullish momentum and began to appreciate in the second half of Tuesday’s session. Appreciati­ng marginally, the currency closed at 68.74 on Tuesday. After encounteri­ng a key resistance at 97.5 in early March, the dollar index started to decline. But the index found support at 95.17 in mid-March, and has been on a recovery mode. Last week, the index had advanced 0.7 per cent. It now faces an immediate resistance at 97.

A strong break above this level can take the index higher to 97.5 in the coming week.

A downward reversal from these key resistance­s can keep the index in a sideways consolidat­ion phase in the wide range between 95 and 97.5.

Rupee outlook

The rupee witnessed a minor corrective decline in the previous week and found support at 69.4. Subsequent­ly, the currency began to strengthen and breached a key resistance at The short-term uptrend of the rupee will remain intact as long as the currency trades above 69.4

69. The short-term uptrend will be intact as long as it trades above 69.4. The currency can regain strength and trend higher to 68.5 in the near term.

A strong break above 68.5 can take it northwards to 68 against the dollar in the short term. An emphatic break above 68 will underpin the

short-term uptrend and take it higher to 67.55, which is a vital resistance for the currency from a medium-term view.

Having said that, the nearterm positive outlook will get negated only if the rupee falls below 69.4 conclusive­ly.

In such a scenario, the rupee can extend its decline to 70 in the short term.

 ??  ??

Newspapers in English

Newspapers from India