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USD/ZAR: Move Lower as Value Range Drifts Towards Support

By Robert Petrucci
Robert Petrucci

Robert Petrucci has worked in the Forex, commodity, and financial profession since 1993. Important aspects of his work involve risk analysis and advisory services. As an advisor in a Family Office he maintains a conservative approach for wealth management and investments. Robert also works in private finance with investors and companies delivering financial and management services....

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The USD/ZAR has moved lower in the past day of trading, as its short-term range has shown some consolidation and drifted towards support levels.

The USD/ZAR as of this writing is near the 15.83000 mark as the Forex pair displays the ability to drift towards support levels the past day of trading. A view of a three-month chart clearly shows the USD/ZAR within the upper level of its price range and long-term charts also deliver the same perspective. Technically, the USD/ZAR has traded over the 16.00000 as recently as yesterday, but it was not able to sustain prices over this important psychological juncture.

On the 26th of November the USD/ZAR traded near the 16.35000 juncture as the pair certainly felt the effects regarding concerns surrounding the Omicron variant of coronavirus. While there are still plenty of potential causes for alarm regarding the new variant, financial institutions have seemingly taken a deep breath and recovered from their first impulse to buy the USD/ZAR. Over the past week of trading, support levels have begun to look vulnerable and the USD/ZAR has drifted lower.

Importantly from via technical considerations, the USD/ZAR is now trading near support levels it traversed the day before a lot of the Omicron hyperbole was brought forth by global media. If support levels near the 15.81000 to 15.79000 ratios can be proven vulnerable, there may be reason to suspect further downward momentum could be generated by the USD/ZAR.

Speculators within the USD/ZAR need to monitor the market carefully, while it appears the Forex pair has calmed down and is correlating to the broad market it would be wise to have risk management safeguards working. Short-term traders may be tempted to once again enter the waters of the USD/ZAR without the fear of a sudden spike emerging on ‘unexpected’ news coming out of South Africa. If the Forex pair can remain within a tranquil ‘news’ cycle there is reason to believe traders will be able to search for support and resistance levels again which are behaving rationally technically.

Conservative traders who believe there may be additional downside price action for the USD/ZAR should not become overly ambitious quite yet. It may prove to be worthwhile to be a seller of USD/ZAR after moves higher have challenged nearby resistance levels. If the 15.86000 to 15.88000 ratios prove to be durable resistance levels, this could be a solid place to ignite a selling wager while looking for downside price action.

South African Rand Short-Term Outlook

Current Resistance: 15.91700

Current Support: 15.81400

High Target: 16.03000

Low Target: 15.74000

USD/ZAR

By Robert Petrucci
Robert Petrucci has worked in the Forex, commodity, and financial profession since 1993. Important aspects of his work involve risk analysis and advisory services. As an advisor in a Family Office he maintains a conservative approach for wealth management and investments. Robert also works in private finance with investors and companies delivering financial and management services.

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