The rupee appreciated 13 paise to 73.15 per dollar on Tuesday's opening trade as positive domestic equities and weakness in the American currency boosted investor sentiment.
The domestic unit opened at 73.16 against the US dollar at the interbank forex market, and inched 13 paise higher to 73.15 over its previous close.
Yesterday, Indian rupee plunged 21 paise to end at 73.28 against the dollar index that traded near one-month high on risk aversion.
Kshitij Purohit, Product Manager, Currency & Commodities at CapitalVia Global Research said,"Support is at 72.95 - 72.80 levels for the spot pair. Resistance for the pair is 73.20. USDINR Jan future will trade in the range of 73.05 - 73.25 levels."
Abhishek Goenka, Founder and CEO, IFA Global said, "The US dollar has weakened across the board overnight with the euro back up to 1.21 levels. The rupee is likely to trade in 73.05-73.30 range with sideways price action."
Meanwhile, the dollar inde, fell 0.10 per cent to 90.67 against a basket of six currencies.
Reliance Securities said in a research note, "The US dollar index is trading flat this morning in Asian trade against major peers. Markets will look ahead to the testimony of US Treasury Secretary nominee Janet Yellen later in the day. The euro and the sterling were flat to marginally higher against the US dollar this morning in Asian trade."
On the domestic equity market front, reversing from yesterday's lows, market benchmarks traded majorly positive on Tuesday, tracking cues from positive global equities. Sensex added 663 points today to 49,200 and Nifty gained by 183 points to 14,465.
Foreign portfolio investors (FPIs) bought shares worth Rs 650.60 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 42.51 crore in the Indian equity market on 18 January, provisional data showed.
Brent crude futures, the global oil benchmark, rose 0.47 per cent to USD 55.01 per barrel. Oil price continued its downside and concerns rose over fuel demand from major consumers as coronavirus continued to rise.