The USD/ZAR is trading near the 18.69400 vicinity with fast fluctuations being seen as global Forex conditions remain fragile in the wake of a loud Friday which increased nervousness.
After showing the ability to traverse lows on Wednesday of last week near the 18.36000 to 18.35000 ratios, the USD/ZAR has kicked higher and as of this morning is within sight of highs seen on Friday. The USD/ZAR was tranquilly trading near the 18.42000 to 18.43000 ratios on Friday when serenity was broken. The public spat between President Trump and President Zelensky did not go over well in financial institutions.
While the USD found risk adverse buying spike, other major currencies lost value. The correlation to the upwards surge in the USD globally since Friday is a healthy sign perhaps for the USD/ZAR, but there are additional concerns starting to be heard and causing increased tension for traders. South Africa’s coalition government remains firm, but slight cracks are starting to be heard via the public as debates from various political parties have grown more argumentative.
Higher Realms and Nervous Resistance
The USD/ZAR climbed to a high of nearly 18.72285 this past Friday, the current value of the currency pair is near the 18.69400 ratio with rapid price changes via bids and asks. Speculators looking for short-term wagers need to acknowledge that impetus in the USD/ZAR will continue to come from afar. This means that nervousness which exists among financial institutions will increase possibly as the day grows long.
Global Forex conditions are likely to be choppy near-term. Many risk events are ahead this week via the ECB rate decision, U.S Fed members speaking, and U.S jobs numbers, but the importance of sentiment remains critical. Forex traders in the USD/ZAR will react to noise levels coming from the White House and Europe near-term. If calmer heads prevail the USD/ZAR may be looked at as being in overbought territory.
Calmer Days and a Lack of Clarity
Although tranquil trading days are hoped for, they are not guaranteed. Day traders need to be prepared with solid risk management in the USD/ZAR today and tomorrow. The USD/ZAR has the capability of strong price velocity.
- The currency pair is within sight of values not seen since the 5th of February.
- For selling pressure to build momentum the USD/ZAR will need to see calm conditions.
- A solid barometer today will be the USD/EUR, if the EUR is under selling pressure it can be assumed global Forex traders remain nervous.
- Financial institutions will have to be convinced an optimistic outlook mid-term can still be attained, this would help the USD/ZAR start to decline.
- Traders should be content with quick hitting targets today and not get too ambitious, this as long as fragile sentiment and noise are being heard in the broad markets.
USD/ZAR Short Term Outlook:
Current Resistance: 18.69700
Current Support: 18.67900
High Target: 18.72300
Low Target: 18.64100
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