In fact in Intraday charts, this inverse relation is much more clearer.
The USDINR has formed a classic H&S price pattern - which is a reversal pattern - suggesting the reversal of the up trend in the dollar.
The neckline has been broken, a pull back being in process. Indications are in favor of a further fall in the Dollar (against the rupee) and once Rs 49.25 is broken on close, expect it to fall below Rs 47.50.
This augurs well for the stock markets and are indirectly suggestive of a further rally in stocks. The markets are readying for the move towards the first retracement level of the entire fall . .. .
Keep tracking!!!
CA Rajiv D Khatlawala
Head of Research & Training
Jhaveri Securities Ltd.
4 comments:
Rajiv, since you feel that markets are readying to rally to the first retracement of the entire fall, what is that retracement value?
Also, what effect would the falling dollar have on the GOLD, Silver and crude prices in India (MCX rates)?
Eagerly awaiting your reply.
Thanks,
Rishi
Rishi ... Since you are a follower of the science of TA , may be you can yourself compute the retracement value . . .
Regarding effect of fall of Dollar on bullion rates on MCX... surely it will have a negative impact ...
Regards
Rajiv, what do you mean by negative effect on bullion rates? Although internationally the GOLD rates should increase but are you implying that the gold prices will fall here in India?
Correct... the impact willbe to the extent of the % fall in Dollar against the rupee.
So in case of a fast rise in GOLD price in international market, Indian Gold prices will rise, but at a slower rate because of the weakening dollar against the rupee ......
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