• USD/INR picks up bids to snap five-day uptrend, rebounds from five-week low.
• Improvement in RSI, MACD hints at further recovery towards weekly resistance line, 200-SMA.
• Multiple supports challenge bear’s re-entry, 78.40 limits immediate downside.

USD/INR recovers from the lowest levels in five weeks, refreshing intraday high near 78.75 amid early Wednesday morning in Europe. In doing so, the Indian rupee (INR) pair prints the first daily gains in six while bouncing off the 61.8% Fibonacci retracement of the June-July upside.

Given the RSI’s rebound from the oversold territory and the impending bull cross of the MACD, USD/INR is likely to extend the latest rebound from the key Fibonacci (Fibo.) support level near 78.40.

That said, a one-week-old descending trend line resistance near 78.80 guards the USD/INR pair’s further recovery.

Following that, an upside momentum towards the 200-SMA level near 79.20 can’t be ruled out.

In a case where the USD/INR buyers keep reins past 79.20, the 79.70 level could act as the last defense for the bears.

Alternatively, a downside break of 78.40 could recall the USD/INR bears. However, multiple horizontal lines stretched from June challenge the pair’s further weakness around 78.10, 77.90 and 77.60.

Should the pair remains bearish past 77.60, the odds of its slump to June’s bottom surrounding 77.40 can’t be ruled out.

USD/INR: Four-hour chart

Trend: Further recovery expected