The USD/ZAR has tested the fortitude of speculators this week who are looking for long-term trends to be reestablished. The surge higher late last week in the USD/ZAR mirrored other major currency pairs, but trading within the South African rand early this week has remained choppy as conditions have provided only brief tests of support and resistance levels with no major breakout occurring.
However, from a technical perspective, the USD/ZAR has shown the ability to actually have incrementally lower resistance levels the past couple of days. While support levels have not substantially decreased, they have continued to be tested, while higher resistance levels have not been targets as much within the USD/ZAR’s Forex results. This is an indication that the pair may have the capability to continue to creep lower near term.
The USD/ZAR is within shouting distance of the 15.00000 ratio as it hovers slightly above the important juncture. Intriguingly for speculators is the knowledge that the USD/ZAR has traded frequently below the 15.0000 since the middle of December.
Yes, the Forex pair has seen reversals higher, but only from the first week in January until the end of the month did the USD/ZAR reside most of its time above 15.00000. Speculative evidence also suggests via technical charts that risk/reward scenarios favor wagering on bearish price action from its current price levels because resistance levels have proven fairly durable near 15.20000. The last time the USD/ZAR traded above this level in a sustained manner was in January.
The USD/ZAR remains a key fixture within Forex because it underscores the market as a barometer of risk appetite. While the Forex pair has proven vulnerable and climbed above the 15.00000 mark, it has also shown a strong ability to trade lower and test important support ratios below.
The opportunity to sell the USD/ZAR remains an attractive speculative trade if limit orders can be used to activate short positions on slight reversals higher. Targeting support levels near the 15.00000 mark and slightly below for quick-hitting trades remains appealing and potentially worthwhile for traders who have an inclination to pursue the long-term bearish trend, which still technically exists within the USD/ZAR.
South African Rand Short-Term Outlook:
Current Resistance: 15.11000
Current Support: 14.97000
High Target: 15.18000
Low Target: 14.85000
