Traders with a taste for adventure may want to pursue the USD/ZAR in the coming days as the forex pair lingers near higher values.
The USD/ZAR is lingering within its higher short term values and this is setting the table for traders with adventurous streaks in their character. Resistance is also proving adequate the past couple of days for the USD/ZAR which creates the potential for a volatile reaction in the forex pair if and when another sudden breakout occurs.
Resistance near the 15.30000 to 15.33000 marks looks attractive as a place to pursue selling of the USD/ZAR, but it also could prove an important inflection point if bullish momentum builds and punctures those values higher. Call it a coincidence if you want, but the price of Gold the past week and half of trading has seen a downturn in value and this might be a correlation South African Rand traders want to consider.
However, technically the USD/ZAR is not alone with its recent tumult and bullish surge as the USD proves to be a little stronger near term. Speculators may believe the recent higher moves in the forex pair will prove short lived and a technical reaction will soon flourish. The USD/ZAR is traversing values the past couple of weeks which it has not traded since November of 2020. Yes, that was only a couple of months ago, but it highlights the short term move higher in the USD/ZAR may only be a temporary cyclical reversal which will be met with downward pressure.
The million dollar question is if and when the bearish countermove will take place? The USD/ZAR will need to sustain its price near term below current resistance levels in order to make it attractive for many traders to sell again. However, speculators who believe a resumption of bearish behavior will be exhibited soon may be inclined to be sellers using limit orders placed slightly above current market values.
Trading conditions for the USD/ZAR may prove choppy in the short term. Markets may also experience some softer volumes today because of a holiday in the US, which could also spark brief bouts of volatility. Selling the USD/ZAR appears to remain a potentially better speculative trade, stop loss ratios can and should be used to protect against moves that may spark higher.
South African Rand Short Term Outlook:
Current Resistance: 15.33000
Current Support: 15.18000
High Target: 15.47000
Low Target: 15.02000