The Russian ruble managed to start off the year by showing that it is not ready yet to devalue even more against a basket of currencies, especially the US dollar. USD/RUB turned south on the first trading day of 2019 and continues to push in that direction, giving the chance for the bears to play the game too. But how long could this last for?
From the technical side, the current weakness could just be seen as a correction, as USD/RUB still is trading above the medium-term upside support line taken from the lowest point of July last year. If the downside momentum remains strong in the short run, we could see the pair re-testing that upside support line, which, if not broken, could act as a good bouncing ground for USD/RUB.
Looking at the specific levels, USD/RUB is currently heading towards its key support area near 67.5100, marked by the high of the 28th of November. If that zone fails to withhold the rate from falling further, this might clear the way towards the 67.0000 obstacle, or even the above-mentioned upside support line. If that line remains intact, we could see the bulls taking control of the pair and eventually pushing the rate higher, maybe even back up towards the 68.4595 zone.
Our oscillators suggest that there could be a bit more selling on the way for now, as the RSI and the MACD, after topping on the last day of 2018, are now both pointing lower. Although both indicators are still within their bullish territories, they suggest weakening momentum.
The alternative scenario here could be, if USD/RUB breaks below the previously-mentioned upside support line and the rate falls below the 66.1000 support zone, marked by the low of the 12th of December. Only then we could start getting comfortable with lower levels like the 65.4500 barrier, or even the 64.9130 hurdle, which was seen as strong support of the 22nd of November.
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