The USD/ZAR has been able to sustain its higher price range and produce incremental moves which are now creating short term highs. As of this writing the USD/ZAR is beginning to touch values not seen since the 13th of October. Intriguingly the USD/ZAR is within sight of a higher price range which was demonstrated from the 24th of September until the 13th of October.
The past handful of trading days has produced rather consolidated price action within the USD/ZAR and since the 22nd of October the forex pair has effectively maintained the 14.66000 to 14.91000 levels. As the USD/ZAR trades at short term highs and the 14.93000 ratio is being traversed, speculators may be enticed to believe the forex pair has been overbought. However they are cautioned to take a look at one month and three month charts to understand that bullish momentum has been quite capable in the mid-term.
Contrarian traders who want to go against the short term trend and look for reversals lower may be making a logical decision, but they should not be overly ambitious and use nearby support levels as take profit ratios. Until the USD/ZAR begins to push below the 14.80000 to 14.70000 levels, the forex pair can be considered still within the upper realms of its mid-term price band.
Traders within the USD/ZAR should be on the lookout for potential reversals certainly, but the current trend has been achieving a rather incremental bullish tone. Forex trading globally this week has produced mixed results, but the USD has been stronger against many major currencies short term. The USD/ZAR has traded above the 15.00000 as recently as the 12th of October, which was only two weeks ago.
Speculators who want to buy the USD/ZAR should also use their risk management wisely and not become overly ambitious. Cautious traders who want to go long the USD/ZAR may want to wait for slight pullbacks while attempting to catch a reversal higher. More aggressive traders who believe 14.97000 to 15.00000 are going to be tested short term can buy into the market below these realms for quick hitting endeavors.
South African Rand Short Term Outlook:
Current Resistance: 14.95200
Current Support: 14.85000
High Target: 15.04600
Low Target: 14.7300
