Ella 
USD/INR rose for a second straight day on Tuesday and climbed to multi-day highs during the Asian session. Spot prices are currently trading around 83.20, up 0.15% on the day and well within striking distance of the monthly peak hit last week.
The prospect of further policy tightening by the Federal Reserve continues to push U.S. bond yields higher and boost the dollar. Separate risk aversion reflected in weaker stocks also helped the safe-haven dollar stabilize near its highest level since December 2022 hit on Monday. This is therefore seen as a key factor that continues to provide a “tailwind” to the USD/INR pair.
The daily chart oscillators have yet to gain significant positive momentum and aggressive bulls should proceed with caution. Therefore, it would be prudent to wait for some follow-through buying after the 82.30 area, the monthly top, before positioning for any further upside trades. By then, USD/INR may break above the historical 83.40-83.45 level hit on August 15 and is expected to test the 84.00 round figure.
On the downside, any consolidating decline in USD/INR may now find some support around 83.00, followed by last Friday’s swing lows around 82.80-82.75. This is followed by the upward sloping 100-day simple moving average (SMA), currently located near the mid-82.00 level, and then the 200-day simple moving average, located near the 82.35 level. The latter will serve as a key level for the USD/INR pair, and a clear break below it will serve as a new trigger for bears.
At that point, USD/INR may turn weak and accelerate towards the 82.00 mark. USD/INR is likely to extend its downward trajectory further, eventually heading towards the July swing lows around 81.70-81.65.
