USD/INR bounces from strong support zone of Rs. 69.40-Rs. 68.86

After hitting a top at Rs. 74.49 levels during October 2018, Indian rupee witnessed a sharp appreciation against the US dollar. The Indian rupee appreciated nearly 7 per cent to Rs. 69.21 on January 7, 2019 post which the rupee has seen marginal weakness and going forward, we may see some more depreciation at the rupee’s end.  
   
Technically, USD/INR bounced from its strong support zone of Rs 69.40-Rs 68.86 as it is the confluence of 50-weeks exponential moving average, opening-gap support created on August 16,  2018 (Rs 69.03- Rs 69.40) and 50 per cent of its recent upward move started from the low of January 8, 2018 to the high of October 11, 2018.  
   
On the medium term, the 21-day exponential moving average is likely to act as immediate resistance, which is currently quoting around Rs. 70.35. A follow-through move above this level would lead to an extension of the pull-back toward Rs. 70.97.