USD/INR extends slide to new three-week lows despite US data
- Indian Rupee among top performers over the last five days.
- USD/INR holds bearish bias, about to test 71.20.
The USD/INR dropped further to 71.22 hitting the lowest intraday level since November 11. The pair remains near the lows, on its way to the third daily decline in a row.
The Indian Rupee continues to move on a strong note against the US dollar and also across the board. Over the last five trading days is among the top performers. USD/INR kept a bearish bias even after better-than-expected economic data from the United States.
The key report was real Gross Domestic Product (GDP) that grew 2.1% in the third quarter, above the 1.9% expected by market expectations. Also, another key report was the rebound in Durable Goods Orders in October by 1.4%. The greenback gained momentum against majors but not versus the Indian Rupee that continues to be supported probably by expectations of foreign inflows related to ArcelorMittal's acquisition of Essar Steel. The optimism about a phase one deal between the US and China is also supporting INR.
Technical outlook
The pair continues to move with a clear bearish bias. The next strong support area is seen around 71.20 and a break lower would expose 71.00. A daily close below 71.00 would reaffirm the outlook pointing to more strength in the rupee.
On the upside, the critical level in the short-term might be seen at 71.70, a downtrend line that if broken should lead to more gains. Before that level, there is a resistance to consider around 71.55.