• USD/INR eases after the hawkish-Fed led massive surge towards 74.00.
• The spot confirmed a rounding bottom formation on Wednesday.
• RSI retreats but remains bullish. A test of $74.30 remains on the cards.

USD/INR is retreating towards 73.50, correcting a part of Wednesday’s huge rally, triggered by the US Federal Reserve’s (Fed) hawkish surprise.

The world’s most powerful central bank kept its monetary policy settings unchanged in June, although its dot plot chart pointed to two rate hikes by the end of 2023.

The US dollar jumped alongside the Treasury yields on Fed’s hawkishness, sending the cross to monthly highs of 73.83.

The rally is well backed by the technical graph, as the price confirmed a round bottom upside break on the daily chart on Wednesday, courtesy of the FOMC verdict.

At the time of writing, USD/INR has fallen back to test the pattern neckline resistance now support at 73.67. At that level, the 50-Daily Moving Average (DMA) coincides.

The Relative Strength Index (RSI) has turned south but remains well above the midline, justifying the pullback in the prices.

If the abovementioned key support gives way, the spot would then target the horizontal 200-DMA at 73.47.

Further south, the 100-DMA at 73.31 will then get tested.

USD/INR: Daily chart

On the flip side, the bulls will head back towards the initial supply zone at 74.30 should the uptrend resume.

The next relevant bullish target awaits near the end-April highs of around 74.60.  

USD/INR: Additional levels