Indian Rupee steadies amid lower Oil prices

USD/INR remains flat after paring daily losses on Wednesday as the Indian Rupee (INR) received support from lower oil prices after reports that the International Energy Agency (IEA) may release record oil reserves to stabilize markets. Traders may expect an intervention by the Reserve Bank of India (RBI) to cap the downside of the rupee.

West Texas Intermediate (WTI) crude oil price gave up gains from the previous session, trading around $82.30 per barrel during the Asian hours on Wednesday. However, the downside in oil prices may remain limited due to rising uncertainty surrounding the Iran conflict and shipping disruptions through the crucial Strait of Hormuz.

The IEA’s proposed drawdown would exceed the 182 million barrels released in 2022 following Russia’s invasion of Ukraine. It is worth noting that India relies heavily on oil imports to meet its energy needs and remains highly sensitive to fluctuations in oil prices.

The US Dollar (USD) could regain ground on increased safe-haven demand amid rising uncertainty surrounding the Middle East conflict. US President Donald Trump said late Monday that the Middle East conflict could end soon. However, US officials indicated on Tuesday that military operations were intensifying in Iran, with limited prospects for diplomatic negotiations, Reuters reported.

Traders await key US Consumer Price Index (CPI) data due later in the day. Focus will then shift toward Friday’s Personal Consumption Expenditures (PCE) Price Index data. These figures may offer fresh signals on the Federal Reserve’s policy outlook.

Technical Analysis: USD/INR remains above nine-day EMA near 92.00

USD/INR trades around 92.30 at the time of writing, slightly below the previous close. The technical analysis of the daily chart indicates a persistent bullish bias as the pair remains within the ascending channel pattern.

The USD/INR pair holds a clear bullish near-term bias as price consolidates near recent highs above the rising 50-day Exponential Moving Average, while the nine-day EMA tracks just below spot and underpins the latest upswing. Momentum remains positive with the 14-day Relative Strength Index (RSI) hovering in the mid-60s, staying below overbought territory after failing to break higher, which signals persistent but moderated buying pressure rather than exhaustion at current levels.

Immediate resistance is seen at the ascending channel’s upper boundary near the all-time high of 92.81. On the downside, initial support appears at the nine-day EMA at 92.06, followed by the channel’s lower boundary near 91.30.