The USD/ZAR is now trading within sight of the 14.90000 vicinity as its bearish trend, which has been in force since the 3rd of November, has generated additional power. Since reaching a high of 15.50000 only a handful of trading days ago, the USD/ZAR has seen an incremental move lower and the important psychological level of 15.00000 falter yesterday with trading continuing to be sustained under this level predominantly in the short term.
The USD/ZAR certainly demonstrated a strong bullish trend upwards from the 20th of October, but its lower values demonstrated on that date may prove to entice speculative bears into action now. The high water mark accomplished on the 3rd of November challenged values not seen since the beginning of the second week in March. It appears financial institutions have the 15.50000 ratio targeted as a spot in which the USD/ZAR is apparently considered overbought.
The notion that on the 20th of October the USD/ZAR was trading near the 14.35000 level should signal to traders the ability of the USD/ZAR to move with a sincere amount of price velocity when conditions are fast. The past week of trading has been volatile because of the U.S. Federal Reserve’s monetary policy statement which caused nervousness before and after its publication. The fact that the crucial support is now being tested by the USD/ZAR is intriguing.
The last time the USD/ZAR saw a sustained amount of trading below the 14.90000 ratio was on the 26th and 27th of October when the Forex pair traded near the 14.84000 ratio. After the considerable amount of buying power demonstrated in the USD/ZAR from the 20th of October until the 3rd of November, cautious traders may want to see support levels below become vulnerable before attempting to ride another leg downwards. However, the support ratios near the 14.85000 level could prove to be a place that triggers another reversal upwards in the near term too.
Conservative traders who believe the USD/ZAR has more room to traverse lower should not be overly ambitious, and aiming for nearby support levels with quick hitting trades may prove to be worthwhile. The USD/ZAR has achieved some volatility the past two weeks and its price velocity has been rather healthy. Traders are recommended to use adequate risk-taking tactics to capture price action while making sure they are not too aggressive speculatively in the meantime.
South African Rand Short-Term Outlook
Current Resistance: 14.99000
Current Support: 14.88000
High Target: 15.13000
Low Target: 14.75000
