The USD/ZAR has continued to press up against important long-term support levels and brush them aside.
The USD/ZAR has experienced a slight move higher in early trading, but this has occurred as the Forex pair continues to display a resounding amount of bearish activity. Long-term technical charts must be used by speculators as they consider the potential moves by the USD/ZAR. A low of nearly 14.49000 was tested yesterday and this level now acts as a short-term support juncture.
Traders who have been pursuing the downside price action of the USD/ZAR have likely done well, if they have been using appropriate take-profit and limit orders. However, as the USD/ZAR traverses depths it has not encountered since late January and February of 2019, traders may be asking if they should remain sellers or fear the potential of a reversal higher occurring as a reaction to the dominant theme.
As of this writing, the USD/ZAR is traversing near the 14.55000 mark, and its ability to remain below the 14.59000 level is intriguing. Traders should not be overly zealous with their speculative decisions short term, and should be aware the current price levels may produce a violent reaction which could be sparked suddenly. However, there is no denying that the bearish momentum of the USD/ZAR remains within a bearish trend, and now may not be the time to jump off its trajectory.
Contrarians might disagree and seek upward reversals which they might suspect ‘have’ to develop. If a trader is intent on buying the USD/ZAR, they should make sure they are anticipating short-term endeavors and have a goal of catching incremental movements higher to cash in take-profit orders. Traders who believe that choppy conditions arise because the strong bearish momentum needs to pause may be proven correct, but on the other hand, the USD/ZAR has progressively smashed support levels.
While staying a seller of the USD/ZAR may feel like it will produce challenging conditions because of the recent success of the bearish move, traders may not want to stop speculating on downside momentum quite yet. Traders may want to wait for slight reversals higher which come within resistance levels and use them as a location to activate selling positions. Speculators should be careful within the current lower depths of the USD/ZAR, but there still may be additional support levels which will prove vulnerable.
South African Rand Short-Term Outlook:
Current Resistance: 13.58700
Current Support: 13.49000
High Target: 13.68000
Low Target: 13.38000