Euro vs Indian Rupee price forecast: ₹109.0837 support as EUR/INR trades flat

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Euro vs Indian Rupee drops 0.56% today

Highlights

India enacted policy changes exempting foreign investors from withholding and capital gains taxes on government securities, aiming to boost direct capital inflows.
The measures are designed to stabilize the rupee by attracting institutional funds, though broad selling pressure persists in the FX market.
EUR/INR remains under heavy short- and medium-term technical selling pressure with a projected range of ₹109.0837 to ₹110.1801 and a high probability of further downside.

Rupee strengthened as regulatory reforms drive foreign capital inflows

The Indian government has enacted regulatory changes to lower barriers for foreign investors, including expanding the portfolio investment scheme and exempting both withholding tax on interest and capital gains tax for investments in government securities. These measures facilitate direct capital inflows into India, increasing demand for local currency and assets and potentially putting pressure on EUR/INR via enhanced foreign participation. The policy shift is intended to support rupee stability by attracting institutional funds, though price action has remained under broader selling pressure.

Short-term momentum weakens as technical support persists

On the hourly chart, EUR/INR remains below the MA-20 and MA-50 while still trading above the MA-200, highlighting a contrast between short-term downward momentum and lingering longer-term support. The Ichimoku Kijun line stands at ₹110.1016, acting as an immediate resistance level. Oscillators show the MACD in sell mode, ADX neutral, and a combination of RSI, CCI, and Stoch RSI reflecting ongoing selling pressure or possible oversold conditions. BBP indicates modest buyer activity, while the Awesome Oscillator is neutral, overall reinforcing the intraday downside bias.

Downward bias prevails amid tight consolidation range

Over the next two to three trading days, EUR/INR is expected to remain within a volatility range of ₹109.0837 to ₹110.1801. The probability of further downward movement is characterized as very high, while the likelihood of a sustainable rebound is deemed very low in the short term. The baseline scenario sees the pair consolidating within this corridor unless resistance at ₹110.1016 is breached, which would open the door for a bullish move, or support at ₹109.0837 is broken, signaling further downside risk.

Anton Kharitonov, Analyst at Traders Union, sees EUR/INR under sustained near-term pressure with technicals highlighting downside momentum. He notes that recent government reforms should support rupee stability by attracting more institutional inflows, but so far this has not reversed bearish price action. Consolidation within the ₹109.0837 to ₹110.1801 range is likely unless key levels are breached. "Until EUR/INR closes back above the ₹110.1016 resistance, I remain defensive and do not trust the upside."

Earlier, analysts noted that while EUR/INR exhibited short-term weakness, the broader outlook remained cautiously constructive due to underlying long-term support. The latest regulatory changes in India coupled with ongoing technical pressure reinforce the downside risk, making close attention to potential volatility and breakouts beyond the established range particularly important for active traders.

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

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.