₹95.2992–₹96.2570 range limits US Dollar vs Indian Rupee movement

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US Dollar vs Rupee gains 0.52% today

Highlights

India removed tax on foreign investor interest income in government securities and broadened access to attract more overseas capital inflows.
The Reserve Bank of India eased foreign deposit rules and raised external borrowing limits for public sector entities, supporting market stability and funding access.
USD/INR remains in a bullish technical setup, with strong buy signals and an expected trading range of ₹95.2992 to ₹96.2570, favoring continued upward momentum.

Foreign capital inflows rise as RBI eases access and regulations

The Indian government and the Reserve Bank of India have introduced several confirmed measures to attract foreign capital, such as scrapping tax on interest income for foreign portfolio investors in government securities and expanding the eligibility of specified securities under the fully accessible route. These actions are designed to increase market liquidity and facilitate a greater presence of overseas investors in Indian securities. Additionally, the Reserve Bank of India has eased requirements for banks to collect foreign deposits and allowed public sector undertakings to raise more external commercial borrowings, boosting access to foreign funding sources and supporting overall market stability.

Bullish signals diverge as weak trend tempers price momentum

On the hourly chart, USD/INR trades above the MA-20 and MA-50, while on the daily timeframe, it remains well above the MA-200. The Ichimoku Kijun level sits at ₹95.3424, providing immediate session support. The expected trading range for the next several sessions is between ₹95.2992 and ₹96.2570. Regarding momentum, MACD signals a buy bias, yet ADX reflects weak trend strength. RSI and CCI display mild buying pressure, with Stoch RSI neutral and BBP showing persistent intraday buyer dominance, though the AO has yet to align with this direction. The divergence between ADX and MACD points to some uncertainty about the trend’s persistence despite bullish oscillator readings.

Range-bound consolidation favored as mixed indicators limit direction

Over the short term, USD/INR is likely to consolidate within the ₹95.2992 to ₹96.2570 volatility band relative to current levels. Should resistance be breached, the upper end of the range could be tested, with an upward extension possible if buying momentum intensifies. Conversely, if support at the Kijun level is lost, a pullback toward the lower boundary of the projected band may unfold. The baseline scenario favors further range-bound trade, given the current mix of momentum and trend indicators.

Viktoras Karapetjanc, expert at Traders Union, sees the recent government and Reserve Bank of India measures as fundamentally supportive for the rupee in a constructive way. He believes increased access for foreign investors and expanded funding channels contribute to positive capital flows and market stability. Momentum indicators are mixed, yet macro and regulatory factors point to ongoing demand for Indian assets. Short-term consolidation is likely as the market absorbs these positive steps. "With supportive policy moves and solid macro backing, I expect USD/INR to remain resilient and see potential for an upward extension if buying persists."

Earlier, analysts noted that short-term weakness in USD/INR contrasted with medium- to long-term bullish signals as regulatory reforms aimed at boosting foreign capital inflows supported underlying strength. The current setup, marked by fresh policy actions and divergent momentum indicators, suggests traders should remain alert for a shift outside the established ₹95.2992–₹96.2570 range as volatility dynamics evolve.

Source of Data: USD Price Analysis by TU

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

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.