Tue. Sep 28th, 2021

    Why #GBPINR and #EURINR is always difficult to trade ??

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    Morning it shows something and in evening picture changes. Let’s understand why this happens through this Article:

    Logic Behind GBPINR / EURINR / JPYINR MOVE

    Hello Friends,
    Most of the currency traders get confused about the move in #GBPINR / #EURINR / #JPYINR pairs. Many of you know this and many don’t know about this, so let’s get started :

    In India sessions these pairs give different moves and in the evening session when #US / #UK market opens it starts giving different moves which result in gapup / gapdown the next day in Indian timings when market opens.

    So why this happens ? Why these pairs gives so bizarre moves and confuses every traders. I try to explain you all with very simple logics and with examples

    I hope everyone know that #GBPUSD and #EURUSD trades in Dollar value and #GBPINR and #EURINR trades in rupee terms and takes cues from them (not always).

    Let’s take one LIVE example here in #EURINR :

    So suppose #EURUSD right now trading at 1.2150 and #USDINR trading at 72.50 levels ; so when you multiply both #EURUSD and #USDINR you come out with #EURINR value which is 1.2150*72.50= 88.09 and that’s the current value of #EURINR right now. But for example suddenly in morning session at 11 o’clock #USDINR slumps due to weakness and gives 40-60 paisa quick down move in 15-30 mins then #USDINR multiplier goes down; now calculate value again keeping #EURUSD constant ; so 1.2150*72.00= 87.48 which is #EURINR value. It means #USDINR down by 50 paisa then #EURINR automatically down by 61 paisa. Remember we kept #EURUSD constant here.

    Now our market closed with #USDINR at 72 levels and in evening #US / #UK market opens and #EURUSD goes upward and #USDINR retrace about 10-15 paisa for example which usually happens. So now #EURUSD trading at 1.2200 levels and #USDINR spot trading in evening at 72.10 levels so now calculate #EURINR value which is 1.2200*72.10=87.97. so #EURINR will trade at 87.97 levels in spot. Now you will think in morning #EURINR was down and it was looking short candidate, but now it’s going upward and next day you see gapup in #EURINR and trading above 88 levels.

    Same with #GBPINR = #GBPUSD * #USDINR


    #INRJPY= #USDINR /#USDJPY (as per investing/trading view)

    In these above scenarios we kept constant #EURUSD value while calculating. Change it as per market conditions as both #EURUSD and #USDINR keeps on moving. Now think if both #EURUSD and #USDINR becomes volatile and gives 50 PIPS move rapidly in a day. #EURINR becomes huge volatile and gives 1 Rs move up / down.

    Now think for example #USDINR trades at 77 levels currently so what’s the value of #EURINR and #GBPINR rightnow keeping #EURUSD and #GBPUSD constant :

    #EURINR : 1.2150*77.00=93.55

    #GBPINR : 1.4080*77.00= 108.45


    #JPYINR: 77/ 105.25= 0.7315

    Now calculate #EURINR if #EURUSD comes at 1.0500 levels and #USDINR goes to 75 levels

    1.0500*75.00= 78.75

    that’s why I always say in our sessions #USDINR is king and all INR pairs takes cue from #USDINR and in evening session pairs takes cues from #EURUSD / #GBPUSD / #USDJPY

    Generally #USDINR goes up / down big in market hours only because big trades happens in futures only. Very rare occurrence when we see big gapup / gapdown in #USDINR like 60-80 paisa ( once in a blue moon)

    But please take a note when you do analysis technically then don’t mix these pairs. Keep all separate and can take support of #EURUSD for #EURINR and #GBPUSD for #GBPINR and #USDJPY for #JPYINR

    I hope this simple calculation you understand and now you understand why there is so much confusion when we trade in #EURINR / #GBPINR / #JPYINR as morning session gives different picture and evening sessions says something else which result in gapup / gapdown next day here in our session

    Happy Trading !!!
    RUCHIT THAKUR (RT)
    +91-7771081622

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