Technical analysis: Will USD/ZAR quotes continue to decline?
USD/ZAR technical analysis summary
Below 16,84.
Sell Stop.
Above 18,52.
Stop Loss.
| Indicator | Signal |
| RSI | Neutral |
| MACD | Sell |
| MA(200) | Neutral |
| Fractals | Sell |
| Parabolic SAR | Sell |
| Bollinger Bands | Neutral |
USD/ZAR chart analysis
On the daily timeframe, USDZAR: D1 broke down the support line of the rising channel and approached the 200-day moving average line. It must be broken down before opening a position. A number of technical analysis indicators formed signals for further decline. We do not rule out a bearish movement if USDZAR: D1 drops below the 200-day moving average of 16.84. This level can be used as an entry point. The initial risk limit is possible above the last 2 upper fractals, the upper Bollinger band and the Parabolic signal: 18.52. After opening a pending order, we move the stop following the Bollinger and Parabolic signals to the next fractal maximum. Thus, we change the potential profit/loss ratio in our favor. The most cautious traders, after making a trade, can switch to a four-hour chart and set a stop loss, moving it in the direction of movement. If the price overcomes the stop level (18.52) without activating the order (16.84), it is recommended to delete the order: there are internal changes in the market that were not taken into account.
Fundamental analysis of forex - USD/ZAR
South African Reserve Bank raised the rate. Will USDZAR quotes continue to decline?
The South African Central Bank raised the rate to 7% from 6.25%. Now it has almost caught up with inflation, which was +7.6% y/y in October. This is not much more than September's +7.5% y/y. We note that the South Africa Producer Price Index (inflation in industry) in October fell to +16% y/y compared to +16.3% y/y in September. Signs of slowing inflation may support the quotes of the South African rand. November 29 in South Africa will be significant data on unemployment, November 30 - trade balance and December 1 - Absa South Africa Manufacturing Purchasing Managers Index (index of business activity in industry). There will be a lot of important statistics in the US this week, including the publication of the United States Nonfarm Payrolls on December 2nd.
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Author
Dmitry Lukashov
IFC Markets
Dimtry Lukashov is the senior analyst of IFC Markets. He started his professional career in the financial market as a trader interested in stocks and obligations.
