USD/ZAR keeps the upside gap towards 15.50 as Fitch downgrades South Africa


  • USD/ZAR snaps two-day losing streak with the week-start upside gap to 15.42.
  • Fitch downgrades South Africa to BB- with a negative outlook.

Having marked a 10-pips gap-up, from 15.32 to 15.42, at the week’s start, USD/ZAR seesaws in a choppy range, currently around 15.43, during Monday’s Asian session. In doing so, the pair respects the rating downgrade from the global rating giant Fitch while parting ways from the previous two days’ declines.

In its latest update, Fitch said, “Fitch Ratings has downgraded South Africa's Long-Term Foreign-Currency Issuer Default Rating (IDR) to 'BB-' from 'BB'. The Outlook is Negative.” The rating giant cited high and rising government debt, exacerbated by the economic shock triggered by the coronavirus (COVID-19) pandemic, as the key catalysts for the latest announcement on ratings.

Even so, the USD/ZAR bulls remain capped as the US dollar fails to extend Friday’s gains amid mixed sentiment concerning the risks.

Although hopes of the covid vaccine/treatment favor the bulls, a sustained rise in the cases joins the uncertainty surrounding the US Federal Reserve’s emergency stimulus plans, due to Treasury Secretary Steve Mnuchin’s recall of $500 billion, question risks. However, S&P 500 Futures print 0.20% intraday gains while the US 10-year Treasury yields remain sluggish around 0.82% by press time.

Moving on, Wednesday’s October month’s inflation data for South Africa becomes the key indicator to watch for USD/ZAR traders while the November month’s US PMIs and risk catalysts can also direct the pair moves.

Technical analysis

Any moves inside the trading range between 15.45 and 15.21, comprising 10-day SMA and the monthly low, become less meaningful.

Additional important levels

Overview
Today last price 15.4312
Today Daily Change 0.1026
Today Daily Change % 0.67%
Today daily open 15.3286
 
Trends
Daily SMA20 15.783
Daily SMA50 16.271
Daily SMA100 16.6101
Daily SMA200 16.9911
 
Levels
Previous Daily High 15.4644
Previous Daily Low 15.2854
Previous Weekly High 15.584
Previous Weekly Low 15.2832
Previous Monthly High 16.8003
Previous Monthly Low 16.0915
Daily Fibonacci 38.2% 15.3537
Daily Fibonacci 61.8% 15.396
Daily Pivot Point S1 15.2545
Daily Pivot Point S2 15.1804
Daily Pivot Point S3 15.0755
Daily Pivot Point R1 15.4335
Daily Pivot Point R2 15.5385
Daily Pivot Point R3 15.6126

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD advances after US PCE inflation

EUR/USD pressures weekly highs as US core PCE inflation jumped to 3.4% YoY in May, as expected. High yielding assets accelerate their advances to the detriment of the greenback, as government bond yields hold steady.

EUR/USD News

GBP/USD battles with 1.3900, still affected by BOE’s decision

GBP/USD remains depressed around 1.3900, pressured by the dovish BOE's surprise offsetting the renewed weakness in the US dollar. Worsening market mood amid Delta covid strain concerns weigh on the pound

GBP/USD News

XAU/USD rises towards key $1794 resistance ahead of US PCE inflation

Gold is picking up the bid tone in European trading, taking advantage of the retreat in the US Treasury yield and the dollar across the curve. 

Gold News

SafeMoon Price Prediction: SAFEMOON ponders 25% advance

SafeMoon price has underperformed relative to top altcoins but is preparing for a move higher. A retest of the range low at $0.00000257 seems likely before SAFEMOON catapults.

Read more

US PCE inflation preview: Data likely to reaffirm FOMC's hawkish tilt

The US Bureau of Economic Analysis will release the PCE inflation report on Friday, June 25. Markets expect the Core PCE Price Index, the Federal Reserve’s preferred gauge of inflation, to rise to 3.4% on a yearly basis in May from 3.1% in April.

Read more

Forex MAJORS

Cryptocurrencies

Signatures