The number of US dollar/INR is 86.46 with the weakening of the rupee in the conflict in the Middle East, and the companies company advances to the decision of the Federal Reserve Bank

• The US dollar was trading near 86.42, and touched its highest level since April amid continuous geopolitical tensions.
• The escalation of the Iranian conflict and Israel and the call of Trump to raise the demand for safe term, which presses the emerging market currencies.
• Indian raw and weakness of the company raises concerns about the broader FII flows, adding to the negative side of the rupee.
• Traders are looking for US retail sales and federal reserve decision to obtain new signals in the direction of the US dollar.

The Indian rupee (INR) is weakened against the US dollar (USD) on Tuesday, as it abandoned the modest reversion on Monday as increasing geopolitical tenses in the Middle East, the prices of stronger crude oil, and a flexible Green -Erespens before the main interest decision of the Federal Reserve.

The pair of the dollar/INR rose to the highest level during the day 86.46 – the last level was seen on April 11 – and was trading about 86.42 at the time of writing this report, an increase of approximately 0.38 % per day. However, the US dollar slightly reduced after retail sales in the United States were absent from market expectations, which reduced the purchase interest in Greenback.

Tensions erupted between Iran and Israel on Tuesday after Israel climbed the Chief of Staff of Iran in War Time, Ali Steamani – the second commander who was killed within days. In response, Iran launched a new wave of missile attacks and drones targeting Tel Aviv and Herzelia, which led to sirens and chaos in Tehran. In addition to a sense of urgency, former US President Donald Trump called for the immediate civil evacuation of Jiran and insisted that he wanted a “real end” of the conflict rather than a temporary ceasefire. The increasing geopolitical risk has led to risk flows across global markets.

• The rupee has now decreased to its weakest levels more than two months ago, reflecting a steady declining trend so far this month. About 0.77 % decreased in June, which expands its decrease from year to the date of approximately 0.73 % as the continuous oil strength continues and the global market crawls in the effect on the currency.
• According to Jateen Trivedi, Vice President and Research Analyst for Commodities and Currencies at LKP Securities, the rupee is still at risk amid the escalating Middle East conflict. “The weakness in the capital market indicates the potential Fii flows, which adds to the pressure of the rupee,” In a report published by the business standard.
• Stock markets are cautious. The sale widely pulled BSE Sensex by 212.85 points to settle at 81,583.30, while NSE NIFTY 93.10 points were closed at 24,853.40. Foreign institutional investors (FIIS) were clear from the sellers on Monday, with withdrawing 2,539.42 rupees from stocks, according to exchange data.
• In commodities, crude in West Texas, WTI (WTI) increased by about 2.22 % to about $ 71.69 a barrel on Tuesday, backed by concerns about potential show turmoil amid confronting Iran and Israel. The high oil prices usually add to the import bill in India, which leads to additional pressure on the rupee and the current account balance.
• Meanwhile, the US dollar index (DXY), which tracks the green back against a basket of six main currencies, remains fixed from the 98.00 mark after slip to 97.68 on Monday against the background of the more expected factory factory data. The Empire State Manufacturing Index fell to -16.0 in June, down from -9.2 in May, significantly decreased from market expectations and indicates a deeper contraction in the regional factory activity.
• The market concentration has turned into retail sales data in the new United States for the month of May, which showed a more clear decrease than expected by 0.9 % of my mother-the largest decrease in four months-after a 0.1 % decrease in April. This number came weaker than the market expectations by 0.7 %, indicating that consumers retracted the spending before the expected definitions. Meanwhile, the Federal Reserve Bank is still expected to maintain the rates at its policy meeting on Wednesday, with updated expectations and the statements of President Jerome Powell, who are likely to pay attention to any hints on expectations.

Technical expectations: penetration objectives 87.00 as a momentum building

On the technical front, breaking the dollar/INR above the formation of a similar triangle on the graph for 4 hours, hinting that the momentum continues the last rise. The husband holds much higher than 21 periods of EMA near 86.07, supporting positive bias in the short term. The momentum indicators remain encouraging, as RSI hovering near 66 – below the excessive lands in the peak area – and the construction of the graph and the MACD. Continuous trade over the 86.20-86.30 region can disinfect the path to move towards the 87.00 handle.