- USD/INR remains on track to close the second straight day in the positive territory.
- Broad-based USD strength is helping USD/INR push higher.
- The next target on the upside is located at 75.
After posting small gains on Monday, the USD/INR continued to edge higher on Tuesday and remains on track to close in the positive territory near 74.60.
The renewed USD strength seems to be helping USD/INR gather bullish momentum. Earlier in the day, the data from the US showed that the annual Consumer Price Index (CPI) rose to 5.4% in June from 5% in May. This reading surpassed the market expectation of 5% and provided a boost to the USD. Additionally, rising US Treasury bond yields following the dismal 30-year note auction allowed the greenback to continue to outperform its rivals.
USD/INR technical outlook
Earlier in the day, USD/INR edged lower toward 74.40 but the 20-day SMA located in that area acted as support. Meanwhile, the Relative Strength Index (RSI) indicator on the daily chart stays around 60, suggesting that there is more room on the upside before the pair becomes technically overbought.
74.80 aligns as interim resistance ahead of 75 (psychological level). A daily close above that level could open the door for additional gains toward the next static hurdle at $75.20.
On the downside, the initial support could be seen at 74.40 (20-day SMA) ahead of 74.30 (Fibonacci 61.8% retracement of the mid-April-June downtrend) and 74 (psychological level).
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