Forex trading is not a permisible transaction for Indians even under the liberalised scheme of $100000. You can land in jail if RBI comes to know. Forex tarding is explicitly banned in FEMA and is non-bailable offence.
I have confirmed this from forex dept. of 5 banks (Pvt. and PSU both). Only corporates are allowed to trade in forex - subject to the condition that they can use only their free dollar reserves. i.e. they cant purchase dollars by converting rupees into dollar, they can use only the existing dollars they have earned in normal business. Also another condition is that they cannot use leaverage of more than 10 times.
Individuals, please do not trade forex as it can land you in trouble (jail). You have been warned.
According to
http://www.rbi.org.in/scripts/FAQView.aspx?Id=53