JPY/INR Analysis and Path Ahead

• 11 January, 2024 Ruchit Thakur

JPY/INR Analysis and Path Ahead

Morning Update: JPY/INR pair trading around 57.00 levels, will it crack further from its current zone or reverse ?

The JPY/INR, as we noted in our earlier analysis, reached the important resistance zone of 59.50 and then went down brilliantly, as shown. From the 55.00 to 59.50 zone, where it encountered significant supply and significant resistance from the trendline and horizontal, the #JPYINR fell down admirably.

• Upon seeing a significant increase from the 55.00 zone, the JPY/INR came into supply at 59.00 levels and again cracked. 
• On the weekly chart, the significant resistance zone of 59.50–59.70 indicates that there can be further negative trending action for JPY/INR.
• According to the chart, the JPY/INR pair is in a sell on rise mode, and a steep rise presents a selling opportunity.

Please refer to the chart above, which shows that there was strong demand when the value of YEN rose relative to the US dollar and the rupee. As a result, JPY/INR soared from 55.00 odd levels to 59.00 and gained approximately 400 paisa. As we mentioned in our previous JPY/INR analysis, price established a double bottom around the 55.00 zone, from which it precisely rebounded.

Look over the chart above and mark the weekly chart's confluence zone. A confluence zone is the location where two or more trading signals combine to provide a potent buy or sell signal. Effective trading requires finding a trade opportunity with a high probability and low risk.

The initial trendline resistance area to approach is the 59.50–59.70 zone, which is also where horizontal resistance is located. This zone, which showed the confluence of trendline resistance and horizontal resistance, provided an excellent risk-reward ratio for joining the short sell strategy. This was an extremely profitable opportunity, with a target of 200–250 paise and a risk of roughly 40–50 paise as we discussed earlier. 

The JPY/INR may now experience a slight pullback, and it may even rise to the 59.00-59.50 zone once more, but this will simply be a shorting opportunity. The tiny support zone of 57.00-56.50 may see further gains in JPY/INR, but the overall outlook has not changed, and any increase in price represents a potential sell opportunity solely for JPY/INR moving forward. For 56.50 and 55.00 zones, respectively, the downside is open.  

Please review the weekly chart to see the USD/JPY support and resistance levels. Every level is shown in a spot chart.