The USD/INR touched new highs in early trading today as the currency pair continues to show signs of its bullish trend remaining strong.

Speculators of the USD/INR may be tempted to wager against the upside action the currency pair is attaining. However, under the present trading conditions of the USD/INR, selling positions should not be overly ambitious. Speculators shorting the USD/INR should only hope to pocket quick hitting profits based on the notion that reversals downward could prove to be temporary. Seeking a strong move lower could prove expensive short term.

Record Prices may Have Additional Roam to Traverse Higher Near Term for USD/INR

Traders who are simply looking to buy the USD/INR do need to be careful. Yes, the move higher has been impressive, but staying realistic is important while speculating in Forex. The move over the 79.0000 has been accomplished with a strong amount of momentum and psychologically speculators may be targeting the 80.0000 mark, but the next run higher may not ignite short-term.

If the 79.7000 Level is Surpassed Traders may Look for 80.0000 Psychologically in the USD/INR

While traders cannot be blamed for believing the 80.0000 is a legitimate goal, being able to time the potential rise could be difficult and costly if the USD/INR doesn’t produce the results wanted fast enough. Realistic targets are important while trading. Looking for technical resistance levels are difficult when record highs are being made, but waiting for slight reversals lower and anticipating a rebound higher which aims for resistance levels accomplished earlier in the day can prove to be worthwhile sometimes. Aiming above the higher marks needs patience and ability to emotionally remain calm.

• Record highs in USD/INR make the search for resistance difficult, but using price reversals lower and then aiming for recent highs is a realistic goal.
• Volatility as the USD/INR traverses new highs should be expected.

The mark of 79.6000 in the short term appears to be proving durable as resistance, but if this mark is toppled speculators could begin to look at the 79.7000 and 79.7500 levels as realistic. The USD/INR is historically a currency pair that delivers a significant amount of volatility with spikes suddenly erupting, particularly when the USD/INR receives its first initial wave of trading during each day. Today’s move higher was accomplished via a strong surge upwards early in the morning.

The USD has been strong across the board in Forex yesterday and today. The USD/INR may continue to see a swirl of activity in the near term as financial houses looks for equilibrium and consider the next moves by the U.S Federal Reserve and its implications for currency pairs. Traders looking to buy the USD/INR cannot be blamed, but stop loss and take profit orders should be used to make sure risk-taking tactics remain practical and do not result in costly mistakes. Record values sometimes lead to violent trading in Forex and the USD/INR may not be immune to this type of behavior.

USD/INR Short-Term Outlook

Current Resistance: 79.6300

Current Support: 79.3900

High Target: 79.9800

Low Target: 79.0300

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The pair will likely keep rising, with the next main resistance level being at 1.2640.

Bullish View

• Buy the GBP/USD pair and set a take-profit at 1.2640.
• Add a stop-loss at 1.2450.
• Timeline: 1-2 days.

Bearish View

• Set a sell-stop at 1.2496 and a take-profit at 1.2400.
• Add a stop-loss at 1.2550.

The GBP/USD pair held steady as the US dollar continued its bearish momentum. The pair is trading at 1.2530, which is about 3% above the lowest level this year. This price action mirrors that of the EUR/USD and the AUD/USD pairs.

Slowing Economic Growth

A picture is emerging in the UK and the US that the economic growth is starting to slow. On Tuesday, data by S&P showed that services and manufacturing output declined this month as the cost of doing business rose and as the Chinese lockdowns continued.

In the UK, the manufacturing PMI declined to 54.6 while the services PMI fell to 51.8. The same trend happened in the US, where the two inched downwards to 57.5 and 53.5, respectively.

Other numbers have painted a picture in which these economies are falling. For example, with mortgage rates rising in the US, data showed that new home sales declined to the weakest level since the pandemic started. They declined by 591k units in April from the previous 750k. Economists expect this trend to continue for a while.

Meanwhile, energy costs in the UK are expected to keep growing. According to Ofgem, the energy price cap will rise to 2,800 pounds in October from the current 1,971 pounds. This will be the biggest jump in energy prices since 1970s.

As such, there is a likelihood that the country’s inflation will keep rising in the coming months. Data published by the ONS showed that the UK inflation rose to 9% in April, the highest point in decades.

The GBP/US will react to the upcoming US durable goods order numbers that will come out in the afternoon session. The Fed will also publish the latest minutes, which will shed a light on the deliberations by officials.

GBP/USD Forecast

The GBP/USD pair formed a break and retest pattern in the overnight session. The pair did this by retesting the important support level at 1.2496, which was the highest level on May 18th. The pair has remained above the 25-day and 50-day moving averages.

It has also moved slightly below the 38.2% Fibonacci retracement level. Also, the uptrend is being supported by the ascending trendline shown in black. Therefore, the pair will likely keep rising, with the next main resistance level being at 1.2640.

The pair will likely keep falling as bears target the next key support level at 27,500.

Bearish View

• Sell the BTC/USD pair and set a take-profit at 27,500.
• Add a stop-loss at 31,000.
• Timeline: 1 day.

Bullish View

• Set a buy-stop at 30,300 and a take-profit at 32,000.
• Add a stop-loss at 28,000.

The BTC/USD pair correlation with American stocks continued in the overnight session. Bitcoin declined to a low of $28,000, which was the lowest level since May 14th. It has declined by more than 7.50% below the highest level this week.

Bitcoin and Nasdaq 100 Correlation

The BTC/USD pair declined sharply as American stocks declined sharply. The Dow Jones declined by more than 800 points while the Nasdaq 100 and S&P 500 indices fell by more than 2%. This performance is a reflection that the correlation between these assets is continuing.

The most recent crash was caused by the most recent statement by Jerome Powell. In a statement on Tuesday, Powell said that the bank will do whatever it takes to lower inflation. This will involve reducing the bank’s balance sheet through the process of quantitative tightening. It will also involve aggressively raising interest rates.

Another reason for the sell-off was the ongoing margin pressure among American firms as the cost of doing business rises. On Tuesday, Walmart published weak earnings, which showed that the cost of products was rising.

Target, one of the biggest retailers, said that its logistics costs were rising. As a result, shares of most companies like Amazon, Kroger, and Apple declined sharply. Therefore, these risks helped to push cryptocurrencies sharply lower.

The performance of the BTC/USD pair was also a reflection that the recent rally was not strong enough. It is what is known as a relief rally or a dead cat bounce that happens after a major sell-off. Other cryptocurrencies like Ethereum, Ripple, and Avalanche also crashed hard.

Another reason for the sell-off is that there are simply not enough buyers amid the sell-off and that many holders have decided to exit their positions.

BTC/USD Forecast

The four-hour chart shows that the BTC/USD pair declined sharply during the American session. As it dropped, the price managed to move below the lower side of the bearish pennant pattern. It also moved below the 25-day and 50-day moving averages and the Ichimoku cloud. Also, oscillators like the Relative Strength Index (RSI) has tilted lower.

Therefore, the pair will likely keep falling as bears target the next key support level at 27,500. The stop-loss for this trade is at 30,500.

SOL/USD is within sight of highs recently made, but the incremental gains attained by Solana remain under the shadow of speculative unease.

SOL/USD is trading above 56.0000 as of this morning, and Solana was able to trade above 57.0000 earlier in the day. On the 12^th of May during the cryptocurrency crash, SOL/USD went below the 37.0000 ratio. To put things into even better volatile speculative perspective, SOL/USD was trading above 143.0000 on the 2^nd of April. Thus, as of this morning Solana is trading roughly at 2/3’s less than its value one and a half month ago.

However, since hitting the low water mark during the broad cryptocurrency market bedlam displayed last week, SOL/USD has produced a rather polite incremental climb higher. Two days ago Solana traded above the 59.0000 price level, and for the moment this mark seems to be a rather high target for speculators who may be interested in trying to aim for this ratio as a take profit goal. However, while the broad cryptocurrency market remains nervous, traders will likely remain rather jittery about pursuing price ambitions which may seem too far away.

SOL/USD has the capability of trading fast and changes of value by one USD can develop fast.  Under the present market conditions speculators are urged to use entry price orders to pursue their wagers. While trading for the moment has the feel of a rather tranquil setting, this may prove to be rather temporary.

The recent climb of SOL/USD in the past few days may also lead to skeptics believing that Solana has produced a little too much optimism among buyers. If the level of 55.5500 begins to see a challenge below, traders who want to wager on selling positions may believe the 55.0000 price is a legitimate target. If this ratio falters and the price of SOL/USD begins to demonstrate velocity within a bearish trend, technical traders may believe the 51.6000 level is a support ratio which could be tested.

The fast trading conditions which overtook SOL/USD have become more tranquil for the moment.  However traders should not be lulled to sleep by the quiet atmosphere currently being seen. If the broad cryptocurrency market begins to produce nervous selling again, SOL/USD could certainly see lower prices challenged quickly. In the short term it appears SOL/USD may be traversing near resistance levels which could prove to be durable, and short sellers may want to wager on downside motion.

Solana Short-Term Outlook

Current Resistance: 57.7800

Current Support: 55.1300

High Target: 60.3200

Low Target: 49.7400

The pair will likely keep falling as the US dollar strength continues.

Bearish View

• Set a sell-stop at 0.7110 and a take-profit at 0.7000.
• Add a stop-loss at 0.7225.
• Timeline: 2 days.

Bullish View

• Set a buy-stop at 0.7170 and a take-profit at 0.7250.
• Add a stop-loss at 0.7100.

The AUD/USD pair crashed to the lowest level since February 22nd even after the strong Australian inflation data. The Australian dollar retreated to the important support at 0.7100 as data showed that consumer prices are still surging.

Aggressive RBA?

Data published by the Australian Bureau of Statistics showed that inflation rose at a faster pace than expected. The headline CPI rose from 3.5% in the fourth quarter to 2.1% in Q1. That increase was significantly higher than the median estimate of 1.7%.

As a result, the numbers revealed that the CPI rose from 3.5% to 5.1%, which was the highest level in 21 years. Economists poll by Reuters were expecting the number to show that inflation rose by 4.6%. Meanwhile, the trimmed and weighted mean CPIs rose by 3.7% and 3.2%, respectively.

These numbers were higher than the Reserve Bank of Australia (RBA) target of 2.0%. Therefore, analysts expect that the RBA will start talking about rate hikes when it meets next week. Some expect that the bank will actually deliver a gentle 15 basis point rate hike since they believe that it has underestimated the strength of inflation. In the United States, the Fed has been blamed for underestimating inflation last year.

The AUD/USD pair declined after the report because of the stubbornness of the US dollar. The dollar index has been relatively strong as investors focus on the rising global risks. For example, Russia decided to halt natural gas shipments to Poland and Bulgaria. It has insisted that these countries should pay for their gas in rubles. Therefore, there is a likelihood that it will also cut shipments to the rest of Europe soon.

The key catalyst for the AUD/USD pair will be the latest US GDP and initial jobless claims numbers. The consensus is that the American economy expanded by 7.3% in Q1.

AUD/USD Forecast

The AUD/USD continued its bearish trend after the strong Australian inflation data. The decline happened partly because investors were expecting inflation to be strong. It also moved below the 25-day and 50-day moving averages and the 61.8% Fibonacci retracement level. It has also moved below the first standard of the pivot point.

Therefore, the pair will likely keep falling as the US dollar strength continues. If this happens, the next key support level to watch will be the psychological level at 0.7000.