Since September 2021, the rupee has depreciated 9.7 per cent against the dollar, data show. On a year-to-date (YTD) basis, it has depreciated 8.9 per cent, but this is far lower than that seen during the Global Financial Crisis of 2008 and the taper tantrum of 2013.
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"Considering DXY levels that are being talked about, INR can further weaken against Dollar (82-85). Lower Brent crude oil prices is a positive for current account deficit (CAD). However, lower yield gap will incrementally weigh on debt flows and INR," wrote Anjali Verma, a research analyst with Phillip Capital.
With the Rupee quoting above the 81-level, the Indian currency is seen treading over the higher-end of the Bollinger Band on the daily, weekly and monthly charts.
As per the daily charts, Rupee is likely to remain on weak ground as long as the currency trades above 81.55-level. Similarly, the key levels to watch out on the weekly and monthly charts are placed at 81.40 and 80.50, respectively.
In case, the Rupee sustains below 81.55, a corrective move to 80.50-level cannot be ruled out. The key momentum oscillators on the daily and the weekly charts are also in favour of further depreciation on the Rupee.
As per the weekly Fibonacci chart, the Rupee can depreciate to 82 - 82.20 - 82.40 during the week.
As per the weekly USDINR options data expiring on September 28, the highest open interest is at 81-level Call, and in case of Puts is at 80-level. The weekly option data indicates a likely trading range of 80.50 - 82.25 for the contract.
For the day, analysts at IFA Global expect an 81.15-81.55 range for USD/INR with a downside bias. "RBI has been intervening to contain volatility, but the market seems keen on buying dips as of now," their analysts wrote in a September 27 note.
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