The USD/ZAR has reversed higher after challenging long-term support only one day ago and the higher values may be an opportunity for traders.
After touching important support levels the past two days of trading, the USD/ZAR has produced an abrupt reversal higher. The move upwards within the USD/ZAR correlates remarkably well with other major Forex pairs as the USD delivered a sudden dose of strength yesterday. However, speculators who have been pursuing the bearish trend of the USD/ZAR may perceive the higher current values of the Forex pair as an opportunity.
The surge in value began in earnest late yesterday in the USD/ZAR and a high of nearly 14.75000 was approached this morning. Speculators with courage may view the current price vicinity of the USD/ZAR as a worthwhile chance to sell the Forex pair and look for support to be challenged again short term. It is conceivable, though, that the USD/ZAR may become consolidated for a small duration and create choppy conditions.
Speculators are likely correct to believe that the long-term bearish trend of the USD/ZAR will endure, but experienced traders also know that there is a difference between short-term and long-term perspectives. The difference in outlooks can be costly for traders who fail to understand that short-term conditions may not match expectations with a longer outlook. Speculators may want to choose to be cautious and monitor the USD/ZAR to see if current resistance levels are able to be maintained.
The ability of the USD/ZAR to trade below the 15.00000 juncture remains important and, after the strong reversal higher yesterday and early today, traders should keep their eyes on resistance levels beyond nearby targets. The 14.79000 mark will be important in the short term; if this resistance juncture proves adequate, it may be a signal that the USD/ZAR may resume its bearish trend rather quickly and begin to challenge support levels again.
Selling the USD/ZAR remains the logical trading endeavor technically. Traders may want to remain rather cautious within the near term and make sure current resistance levels hold. If higher junctures begin to look relatively stable, selling the USD/ZAR via limit orders looks like a proper tactical approach. Traders should not be too greedy as they pursue support levels below and they should use take profits which target nearby values short term.
South African Rand Short-Term Outlook:
Current Resistance: 14.79000
Current Support: 14.63000
High Target: 14.89000
Low Target: 14.51000