Rajandran R Telecom Engineer turned Full-time Derivative Trader. Mostly Trading Nifty, Banknifty, USDINR and High Liquid Stock Derivatives. Trading the Markets Since 2006 onwards. Using Market Profile and Orderflow for more than a decade. Designed and published 100+ open source trading systems on various trading tools. Strongly believe that market understanding and robust trading frameworks are the key to the trading success. Writing about Markets, Trading System Design, Market Sentiment, Trading Softwares & Trading Nuances since 2007 onwards. Author of Marketcalls.in)

ChatGPT4 Interpretation About USDINR Price Action Analysis

2 min read

I’m impressed by the analytical and reasoning capabilities of ChatGPT4, which inspired me to evaluate its image-processing skills, specifically in interpreting basic candlestick charts. Consequently, I presented an image of the USDINR monthly charts devoid of any technical indicators.

The analysis provided by ChatGPT, while somewhat anticipated, showcases a significant enhancement in its ability to dissect financial markets. Moreover, its capacity to articulate insights using trader and investor jargon marks a noteworthy advancement.

ChatGPT4 Image Analysis using CLIP

For tasks that require interpreting or analyzing images, such as understanding candlestick charts or any other visual content, a model like CLIP or a specialized image processing model would be more appropriate. CLIP is model designed to understand images in the context of natural language. CLIP can interpret images and provide descriptions or respond to prompts by finding the most relevant images based on textual descriptions. It bridges the gap between vision and language models by understanding and associating text with visual content.

ChatGPT4 Response

The image you’ve provided appears to be a monthly candlestick chart of the USD/INR (U.S. Dollar/Indian Rupee) currency pair. Here’s what can be observed from the chart:

  1. Overall Trend: There’s an upward trend in the value of USD against INR over the period displayed, indicating that the U.S. Dollar has been strengthening against the Indian Rupee.
  2. Candlestick Patterns: The chart consists of individual candlesticks, each representing a month’s price movement. Green (or sometimes blue) candles indicate months where the closing price was higher than the opening price, signaling buying pressure. Red candles indicate months where the closing price was lower than the opening price, signaling selling pressure.
  3. Volatility: The size of the candlesticks can indicate the level of volatility. Larger candles suggest greater volatility within that month, while smaller candles suggest less volatility.
  4. Recent Price Consolidation: In the most recent months, the candlesticks are relatively small and closely packed, which could suggest that there is some consolidation in price, with less pronounced movements compared to previous months.
  5. Price Levels: The last visible price on the chart is 82.9810, and it seems that the chart is showing a slight decline from a previous high.
  6. Time Frame: The chart covers a period from early 2018 to around February 2024.
  7. Price Range: Over this period, the price has ranged roughly between 62.0000 and 84.0000 INR per USD.
  8. Support and Resistance Levels: These are not explicitly marked on the chart, but they could be inferred from the price points where the trends have historically reversed or paused.
  9. Trend Lines or Technical Indicators: There are no visible technical indicators (like moving averages, RSI, etc.) or drawn trend lines, which traders often use to make predictions about future movements.

This type of chart is widely used in technical analysis to predict future market movements based on past patterns. However, for a thorough analysis, traders often consider additional data and indicators beyond what’s shown in a single chart.

Asked Similar Question with Google Gemini

Gemini Pro: Offers more refined capabilities for image tasks like image captioning, visual question answering, and image search. It uses the Gemini-pro-vision model specifically for image inputs.

Surprisingly Google Gemini tries to provide a reason for the overall up move in USDINR

Here is the Google Gemini Response

The chart you sent me is a USD/INR currency pair chart from TradingView. It shows the price of the US dollar in Indian rupees over time. The chart includes data from January 2018 to February 12, 2024.

As of February 12, 2024, the price of the US dollar is ₹82.99. This is up from ₹80.00 at the beginning of the year. The price of the US dollar has been increasing steadily since the beginning of 2023.

There are a number of factors that could be contributing to the increase in the price of the US dollar. These include:

  • The Federal Reserve’s decision to raise interest rates in the United States. Higher interest rates make it more attractive to hold US dollars, which can drive up the price of the dollar.
  • The weakening of the Indian rupee. The rupee has been weakening against the US dollar in recent months due to a number of factors, including concerns about India’s economic growth and the trade deficit.
  • Global economic uncertainty. Investors may be seeking safe haven assets such as the US dollar during times of uncertainty.

It is important to note that the forex market is complex and there are many factors that can affect the price of a currency. The information above is not intended to be financial advice.

Rajandran R Telecom Engineer turned Full-time Derivative Trader. Mostly Trading Nifty, Banknifty, USDINR and High Liquid Stock Derivatives. Trading the Markets Since 2006 onwards. Using Market Profile and Orderflow for more than a decade. Designed and published 100+ open source trading systems on various trading tools. Strongly believe that market understanding and robust trading frameworks are the key to the trading success. Writing about Markets, Trading System Design, Market Sentiment, Trading Softwares & Trading Nuances since 2007 onwards. Author of Marketcalls.in)

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