The Pound to Rupee started falling not long after the Indian Reserve Bank cut interest rates at its meeting last week, despite this being the opposite reaction to what would normally be expected from a currency pair after a rate cut.
After breaking temporarily above a major trendline - or triangle pattern border - the pair fell back down below the line, leading us to question previous assumptions that it was going higher.
It is possible this trendline is actually the upper border of a large triangle pattern and the pair is forming a triangle, however, it is far too early to say for sure, since triangles have to have five constituent waves to qualify which this one doesn't yet (it only has 3).
What is clear is that the exchnage rate has now rolled over and is falling steeply and has begun a mini-downtrend lower on the four hour chart, evidenced by the sequence of descending peaks and troughs.
A break below the 82.8600 lows would probably confirm a continuation lower to a probable target at 82.0000.
News and Events for the Rupee
The main data release for the Rupee this week is the Trade Balance, which is released at 12.30 BST on
Thursday, and according to Trading Econiomics, is forecast to show the deficit deepening to -12.9bn in July from -11.9bn in June.
Then Manufacturing and Industrial Peroduction are released on Friday at 12.00 and is expected to decline to 1.0% and 1.4% respectively in June.
News and Events for the Pound
Except for Halifax House Price data, which has already been released and showed a 2.1% rise in July, the first major release for Sterling is on Tuesday, at 00.01 BST, when British Retail Consortium’s Retail Sales monitor will be released.
This is a sentiment survey asking people in the Retail sector for their assessment of business conditions.
Analysts will pay more attention to it given the rising rate of inflation and the squeeze on real earnings that this is causing, which is probably then also reducing retail sales.
On Thursday, August 10, the RICS House Price balance is to be released, with a probable 8.0% rise expected.
At 9.30 on Thursday we have Industrial and Manufacturing Production for June.
The Trade balance for June is out at the same time, and is expected to show the deficit narrowing to 11.00bn from 11.86bn previously.
The data is unlikely to shake the Pound so keep an eye on technical trends, Brexit-orientated headlines and external drivers.