After sustaining a bullish move higher since the 25th of February, the past few days of trading have begun to see bearish sentiment reemerge in the USD/ZAR and important support levels have proven vulnerable. Since trading within the 15.50000 vicinity on the 8th of March, the USD/ZAR has begun to incrementally exhibit downward price momentum.
Traders who continued to believe that bearish pressure would reignite hopefully have been able to survive the early part of March with their speculative wagers and enjoy the fruits produced over the past couple of days and this morning. The price action in the USD/ZAR illustrated the constant need to use risk management when trading Forex. Technically, the USD/ZAR has been able to reestablish its bearish trend, and today’s early trading puts it within striking distance of important support levels which could spark additional speculative selling pressure.
The 15.00000 level has been punctured lower in early trading today, and if this vital inflection point is able to sustain the value of the USD/ZAR below, traders may begin to believe that lower values seen in the middle of February could be the focus. Trading in the USD/ZAR has certainly been volatile, as it has moved in a tightly correlated dance with global markets which proved somewhat averse in early March. However, the past two days have produced a healthy bearish move, which has also demonstrated the USD/ZAR’s ability to mimic the amount of risk appetite major global markets have shown a taste for short term.
Speculators need to pay attention to nearby support levels. If trading is sustained below the 15.00000 level near term, traders may target the 14.92000 mark as a capable support ratio. If this value proves vulnerable, it could then create an additional wave of speculative sellers which eye lower marks enjoyed only one month ago.
The USD/ZAR has proven intriguing because it has mirrored global markets well. Traders may want to continue to pursue speculative selling positions of the USD/ZAR based on the notion that technically it will want to retest mid-term lows as the Forex pair reestablishes its bearish stance, which it has maintained with a rather durable trend. Selling the USD/ZAR on slight reversals higher and looking for quick-hitting targets near current support levels may prove worthwhile.
South African Rand Short-Term Outlook:
Current Resistance: 15.06000
Current Support: 14.92000
High Target: 15.13000
Low Target: 14.80000
