On Tuesday, the rupee increased 0.2% to close at 81.67 against the dollar. Although the value of the Indian rupee has decreased during the previous week, there is a potential that it will turn around. The net foreign portfolio investor flows have been strong in November; as of this writing, the flows stood at $3.2 billion, according to the most recent data from NSDL (National Securities Depository Ltd.). Interestingly, the FPIs have been net buyers in every session this month—with the exception of one. In addition, the worries about demand have caused the price of crude oil to remain below several important levels. As a result of their inverse connection, this is advantageous for the rupee.
Additionally, the dollar has stalled and stayed weak, particularly since the beginning of this month. Despite a fall over the previous week, the charts also suggest a potential recovery even though the basic considerations favor the local currency. The rupee has good support at 81.80 and 82, after having declined from its recent level of 81.67 to 80.50 last week. As a result, it is anticipated to rise from the current level either immediately or following a slight fall to 82. On the plus side, the native currency could possibly retest 80.50 in the near future. The rally might even go 80 miles if it does.
In the most recent sessions, the dollar index (DXY) gained ground. However, it continues to trade below the resistance level at 108.30 as of right now, at 107.30. The bias is bearish as long as it is below 108.30. In the near future, it might fall to 105. The rupee will advance more versus the dollar thanks to such a decrease. We anticipate that reasonable foreign inflows and declining crude oil prices will support rupee appreciation against the dollar. The charts also demonstrate that there are a few strong supports for the rupee. Because of this, we anticipate that the rupee will rise from here, possibly reaching 81.30 in a week and then 80.50 in two to three weeks.