The USD/ZAR is lingering slightly below the 19.00000 level in early trading this morning, having essentially tested a narrow range since Thursday.
The USD/ZAR as of this morning is near the 18.92900 ratio as of this writing. In early trading the USD/ZAR has seen a bit of a selloff having produced a low below the 18.90000 mark. The currency pair has traded within a rather narrow range the past couple of days, but importantly the USD/ZAR has been able to sustain prices below the 19.00000 level which is likely seen as an important psychological realm by many financial institutions and speculators.
USD/ZAR is Below Highs Seen Last Week
The USD/ZAR is below the highs the currency pair achieved early last week when prices near the 19.44225 ratio were seen last Monday. Worth noting is that highs last week were also below apex prices touched on the 5th of October, when the USD/ZAR reached the 19.64260 level and did so again on the 6th. The near-term trend lower in the USD/ZAR may be enough to draw speculators in who believe the currency pair remains in territory which could still produce a downturn.
The broad Forex market continues to see the USD produce strength, but the USD/ZAR has correlated to global near-term conditions and produced a slight selloff as financial institutions seemingly wager the USD may have become too strong. In the coming days, tomorrow’s Retail Sales numbers from the States could affect the USD/ZAR, but most of the influence over the next few days may simply come via the U.S Treasury yields. If the bond market can remain calm and yields continue to show a slight decline, this may be a signal the USD/ZAR could decline further.
USD/ZAR Remains within Sight of Highs and Potentially Nervous Trading Conditions
While last week’s decline from early highs may be attractive, the USD/ZAR has not produced a massive break lower. The low for last week occurred on Wednesday when the 18.78000 level was challenged for about half a day. Traders looking for downside should not get overly ambitious and if they are pursuing selling positions may want to take profits near perceived support levels which are nearby.
- The support level of 18.90000 should be monitored; if this level proves vulnerable the USD/ZAR could find itself testing the 18.88000 to 18.85000 values.
- The USD/ZAR will rely on market sentiment remaining calm globally in the near term, if this happens, the currency pair may be able to continue trending lower.
USD/ZAR Short Term Outlook:
Current Resistance: 18.94100
Current Support: 18.90025
High Target: 19.00500
Low Target: 18.84100
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