Because that's the direction traders will trade it in coming weeks considering how the INR is set up on the chart.
Here's USDINR Daily Chart
As you can see in the chart above: USDINR broke out above 64.28 around middle of August and sharply depreciated to 66.9. It then pulled back and now has taken support at 100 dma.
Trading Rule: When any asset is in strong uptrend (in above case: depreciation trend), then a pull back to moving average acts as strong support, and then asset usually resumes the trend
It's just the way USDINR is setup on the chart - depreciation highly likely in INR over next few weeks.
Also - Note - USD index has started moving up again...
In markets, we are dealing with probabilities and nothing is certain. We can only assume behavior based on past readings of trend
Please do your own due diligence before trading or investment. Do not treat the above as any recommendation
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Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers
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