USD/INR Technical Analysis: hits 3-month low below 38.2% Fib retracement

• The USD/INR pair gapped lower on Thursday and hit a three-month low of 70.05.
• The pair is currently trading below 70.19 - 38.2 percent Fibonacci retracement of 63.25/74.49.

Daily Chart

• As seen above, the 14-day relative strength index (RSI) has fallen back below 30.00, signaling oversold conditions. As a result, bearish momentum may wane in the short-term.

4-hour Chart

• Over on the 4-hour chart, the pair has closed new cycle low. The RSI, however, is charting a higher low, that is, a bullish divergence would be confirmed if the currency or the next 4-hour candle closes on a positive note.
• The pair may revisit 10-day EMA hurdle, currently at $70.90. The outlook would remain bearish as long as the 5- and 10-day EMAs are trending south. A daily close above the 10-day EMA, however, would neutralize the bearish setup.

Trend: Corrective bounce likely