The rupee remained broadly range-bound in the past week. The currency opened the week on a slightly negative note on the back of geopolitical tensions and fell to a low of 64.74 by Wednesday.

However, the currency got a breather after US President Donald Trump’s comment that the dollar is getting very strong. This helped the rupee strengthen and reverse higher to 64.26 before closing at 64.51 on Monday.

Lack of support from foreign portfolio investors (FPIs) and the domestic equity market also capped the upside in the rupee last week. After pouring $4.8 billion in three weeks, FPIs bought just $685 million in the Indian debt segment last week.

In the equity segment, FPIs turned net sellers last week after being net buyers for 12 consecutive weeks. They sold $358 million in equities last week and the Indian benchmark indices also closed marginally lower. The FPI action in the coming weeks will need a close watch as further selling may see the rupee losing momentum going forward.

The dollar index (100.26) has come off sharply after touching a high of 101.34 on April 10. The near-term view is negative and there is a possibility of the index falling to 99.5 in the coming days.

A break below 99.5 can drag it even lower to 99. The level of 99 is a key short-term support.

A reversal from 99 will take the index higher to 100 and 101 levels. The region between 101.2 and 101.35 is a key resistance for the index.

A strong break and a decisive weekly close above 101.35 are needed for the downside pressure to ease. Such a break will increase the likelihood of the dollar index breaking above 102 and rising to 103 or 103.5 thereafter.

As expected, the rupee received support in the 64.70-64.80 range in the past week. A range-bound move between 64.25 and 64.80 is possible in the near term.

If the rupee breaks below 64.8, it can fall to 65.10 or 65.15 initially. Further break below 65.15 will increase the likelihood of the rupee weakening to 66 levels once again in the short term.

A break above 64.25 can take the rupee higher to 64 or 63.95. As mentioned last week, the region between 63.95 and 63.85 is a crucial medium-term resistance level.

The 200-week moving average and a strong trend-line resistance are poised in this region which can halt the current rally in the rupee. A subsequent reversal from this resistance zone may drag the rupee lower to 66 levels once again.