GBP/INR support test: Support levels in focus

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Pound Sterling falls 0.52% to ₹127.417

Highlights

The Indian rupee strengthened for a fifth session against the dollar, supported by falling crude oil prices and Reserve Bank of India interventions.
RBI actions, including bond sales and ongoing forex swaps, reduced banking system liquidity and curbed speculative activity in the rupee.
GBP/INR trades below short-term moving averages with strong sell signals from technical indicators, expecting further downside toward a ₹126.78 to ₹128.054 range in coming sessions.

Rupee strength persists as RBI tightens liquidity and dollar sales rise

The Indian rupee strengthened for a fifth consecutive session against the US dollar, primarily supported by a notable decrease in crude oil prices and active dollar selling by state-run banks on behalf of the Reserve Bank of India, according to Business Standard and Bfsi Economictimes Indiatimes. This period saw the RBI utilize tools such as bond sales, foreign exchange swaps, and direct rupee defence to more than halve the banking system's liquidity surplus, which had previously swelled following heightened foreign currency inflows. Ongoing swap operations also continued to drain excess liquidity from the financial system, curbing speculative activity and consolidating the rupee's position. These central bank actions have contributed to sustained downside pressure on GBP/INR.

Intraday sell signals mount as technical support narrows

On the H1 chart, GBP/INR is trading below its MA-20 at ₹127.92 and MA-50 at ₹128.14, while on the daily timeframe the pair remains above the long-term MA-200 at ₹126.70. The Ichimoku Kijun on the daily chart is marked at ₹127.85 and serves as the nearest resistance level. Momentum indicators offer a negative setup: MACD and ADX continue to signal Sell, while RSI, Stoch RSI, and CCI all show oversold readings, highlighting stretched intraday downside. Bull/Bear Power indicates that sellers dominate the immediate order flow, and the Awesome Oscillator confirms the prevailing downward momentum. There is no visible divergence among these major indicators.

Rangebound trade and elevated downside risk as rebound odds fade

Looking ahead to the next two or three sessions, GBP/INR is expected to trade within a band of ₹126.78 to ₹128.05, reflecting typical volatility relative to current levels. The probability of an upward move remains very low, and downside risk is pronounced, making a rebound scenario considerably less likely. The baseline expectation is for price to remain rangebound until a decisive breakout occurs; a move above the Kijun resistance at ₹127.85 would set up a bullish scenario, while a break below projected support would confirm further downside pressure.

Viktoras Karapetjanc, Traders Union expert, highlights the firm support for INR from RBI interventions and lower crude prices. He notes that downside pressure dominates GBP/INR on both macro and sentiment grounds. Karapetjanc sees little scope for a strong rebound as liquidity tightening and central bank action keep the rupee resilient. He expects GBP/INR to remain rangebound, with a bearish tilt unless there is a break above ₹127.85. "With RBI measures still absorbing excess liquidity, I see the rupee’s strength as sustainable in the short term, keeping GBP/INR under pressure."

Earlier, analysts noted that GBP/INR was under persistent downside pressure, with weak technical momentum and narrow volatility suggesting a sustained bearish bias. The latest developments reinforce this outlook, with central bank interventions and stretched negative momentum keeping the focus on potential further declines, making a decisive move below immediate support the key scenario to monitor.

Source of Data: GBP Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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