The USD/ZAR has re-established its bearish trend with relative ease and key support levels are being hovered over as the value of the Forex pair remains near the 14.57000 ratio early this morning. After experiencing a slight spike upwards early last week, the USD/ZAR has shown an ability to create downward momentum again and is challenging late January 2020 values.
South Africa remains under a critical eye as coronavirus implications continue to hit the country and cause economic problems, but the South African rand has remained within its bearish trend against the USD. The stronger South African rand may cause further problems for the nation’s exporters, but the currency, like many others against the USD, continues to become stronger.
Trading volumes will remain light this week as commercial and financial institutions celebrate the holidays, but the ability of the USD/ZAR to show it remains within a downward trend is evident and speculators may want to try and take advantage. Trading within the Forex pair may remain consolidated short term, but sudden volatility should be looked out for if market conditions prove unbalanced and produce temporary strong moves. Speculators may want to look for upside momentum to test short-term resistance levels in order to become a seller.
Support near the 14.53000 to 14.51000 junctures could prove to be very important. In late January of this year, the USD/ZAR was within this price vicinity when coronavirus concerns began to initiate a strong bullish move until the early highs of April were seen. However, if the bearish trend remains steady, technical traders will keep their focus on the 14.51000 to 14.47000 marks.
Short-term trading may prove choppy with light volumes within Forex, but if the 14.47000 level proves vulnerable in the USD/ZAR, it could be a vital inflection point. The USD/ZAR has demonstrated its capability to penetrate support levels since early this November and to trade fast. If momentum downwards is maintained, it is conceivable that the USD/ZAR may be aiming eventually for the 14.0000 value juncture.
Speculators need to remain alert, but they should also keep in mind that the bearish trend within the USD/ZAR remains a dominant feature. Traders may want to continue to keep looking for opportunities to sell the USD/ZAR and test support levels. Quick-hitting trades during the holiday season may remain the best way to participate in Forex short term, and traders should not get too greedy. Cashing in winning positions if they emerge so the profits do not vanish when reversals occur should be considered a vital part of risk-taking tactics near term.
South African Rand Short-Term Outlook:
- Current Resistance: 14.64000
- Current Support: 14.51000
- High Target: 14.72000
- Low Target: 14.46000
