The USD/ZAR has produced a reversal higher since hitting lower values on the 17th of March, and short-term resistance levels are being challenged.
Do not be fooled by a look at a one-day technical chart of the USD/ZAR, as it shows a slightly lower move in the past couple of hours. The Forex pair continues to stay within sight of important resistance above and global risk appetite has turned nervous the past day. The long-term bearish trend of the USD/ZAR may be comfortably intact, but the short term should be given a different perspective. Experienced traders understand they can have two different viewpoints on a currency pair depending on timeframes.
The USD/ZAR briefly challenged the 14.92000 juncture in early trading today, but the resistance level held. However, speculators with a taste for pursuing upside momentum may feel inclined to be buyers of the USD/ZAR and target this resistance level and beyond. If the 14.93000 mark fails to hold and trading above this mark is maintained, the 15.00000 level may become a target short term.
Global risk appetite has taken a turn for the worse the past day as news about coronavirus setbacks have infiltrated the mass media and may be affecting investors. While this may be causing a temporary surge in reversals within Forex, short-term traders should not be fooled by the current gyrations within the marketplace, because technically the USD/ZAR is still within a bearish trend and it has not shown any strong signs that this is about to stop.
Traders need to understand that the short-term market may be nervous and this may cause the USD/ZAR to see technical moves higher which test nearby resistance levels. However, it is unlikely that moves higher will become entrenched. Short term buying positions for traders who want to pursue higher values are advised to use take-profit orders that do not delay cashing out winning positions if they are accomplished. The point is that while the USD/ZAR may see some more bullish activity, technically the Forex pair is unlikely to make this a prolonged event.
Short term, if a trader wants to buy the USD/ZAR on small movements downward that come within sight of support levels and look for slight reversals higher, an opportunity may be found. Forex may produce choppy conditions the next couple of days as investment houses gauge their risks and perceptions globally. The USD/ZAR may produce a higher move short term, but traders should be ready for the potential of the bullish behavior to possibly run out of power sooner than later.
South African Rand Short-Term Outlook:
Current Resistance: 14.93000
Current Support: 14.75000
High Target: 15.03000
Low Target: 14.64000