Euro vs Indian Rupee holds steady as Reserve Bank of India aggressive dollar sales continue

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Euro vs Indian rupee down 0.58% today

Highlights

The Reserve Bank of India intervened heavily in currency markets, selling dollars via state banks after the rupee hit record lows.
Ongoing rupee weakness stems from elevated U.S. yields and persistent high oil prices, prompting a return to aggressive support measures.
EUR/INR retains a bullish structure above key supports, with a high probability of sideways-to-up movement in the ₹109.80–₹111.90 range, though short-term signals suggest near-term caution.

RBI intervention sparks rupee rebound amid oil-driven weakness

The Reserve Bank of India carried out aggressive dollar sales through state-run banks to counter the rupee's depreciation, implementing this action after the currency reached all-time lows. This intervention, conducted before the market opened, represents a return to tactics last used in March and addressed ongoing currency weakness tied to sustained oil prices and elevated U.S. yields. These steps provided immediate liquidity support for the rupee and were accompanied by a notable reversal of recent depreciation, though price action has remained under broader selling pressure.

Divergent momentum signals as buyers hold upper hand above supports

Technically, the EUR/INR is anchored just above the SMA-20 at ₹111.5845 and holds a clear margin over the SMA-50 at ₹110.0037 and the SMA-200 at ₹106.8060. The Ichimoku Kijun acts as immediate support at ₹111.2261. On the daily timeframe, the MACD remains firmly in 'Strong Buy' mode and the ADX sits at 34.4 indicating robust trend strength, while the RSI is constructive at 59. However, Stoch RSI is oversold and CCI reads neutral, consistent with a short-term consolidation after an extended move. Bull/Bear Power (BBP) signals buyer dominance intraday, but the Awesome Oscillator is neutral, underscoring divergent signals between momentum and oscillators.

Rangebound trade expected as breakout risk remains elevated

In the short term, the EUR/INR is expected to trade within a ₹109.80 to ₹111.90 volatility band, reflecting typical fluctuations around major technical levels. Probabilities strongly favor continuation or stabilization, with an over 80% chance of holding or advancing from here. The baseline scenario points to sideways movement between support at ₹111.20 and resistance at ₹111.90. A clear breakout above ₹111.90 may unleash further gains, while sustained moves below ₹111.20 could increase the risk of a retracement toward ₹110.00.

Viktoras Karapetjanc, expert at Traders Union, sees the RBI's aggressive dollar sales as a powerful signal of determination to support the rupee. He believes this renewed intervention, backed by stable oil and U.S. yield dynamics, should help anchor EUR/INR within its current trading band. Strong technicals and continuing macro support reinforce a moderately bullish bias for the Indian rupee near term. "If RBI's resolve persists and global headwinds remain contained, I expect INR stability to hold above ₹111.20 and see upside risks for euro gains capped at ₹111.90 in the coming sessions," the analyst concludes.

Earlier, analysts noted that Together’s UK mortgage-backed securitisation highlighted the importance of strong credit enhancement and active market interventions in maintaining asset stability. The current action by the Reserve Bank of India adds a new dimension, as proactive central bank intervention in the currency market underscores the EUR/INR’s reliance on policy support, making future movement sensitive to any official changes in intervention stance.

Source of Data: EUR 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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