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  • Indonesia’s Rupiah is rising ahead of the Bank of Indonesia’s rate decision. 
  • More than 50% of economists polled by Reuters expect the central bank to keep rates unchanged on Tuesday. 
  • The pair is stuck in a sideways channel or consolidation pattern on the hourly chart. 

Indonesia’s Rupiah (IDR) has erased losses against the US dollar but remains trapped in a sideways channel, according to technical charts. 

The USD/IDR  pair is trading largely unchanged on the day near 15,700 at press time, having printed a high of 15,857 about two hours ago. The IDR is likely drawing bids the Bank of Indonesia is likely to keep interest rates unchanged at 4.5% on Tuesday, according to fifteen of 28 analysts polled by Reuters. The central bank has trimmed rimmed the benchmark rate twice this year in response to the coronavirus outbreak. 

The immediate outlook is neutral as the pair is trading inside the consolidation pattern on the hourly chart. A break above the top end of the sideways channel at 15,860 would imply a channel breakout and open the doors to 16,100 (target as per the measured move method). 

However, range breakdown below 15,628, if confirmed, would imply a continuation of the sell-off from record highs above 17,600 reached on April 1 and will likely yield a slide to support at 15,440 (March 27 low). 

The USD/IDR pair will likely rise above 15,860, confirming a channel breakout if the Bank of Indonesia surprises markets with a rate cut. 

Hourly chart

Trend: Neutral

Technical levels