USD/ZAR Price Analysis: Bulls lose steam ahead of Fed decision, South African data


  • USD/ZAR declined towards 18.933, near the 20-day SMA.
  • South Africa reports August Inflation figures and July Retail Sales on Wednesday.
  • Federal Reserve (Fed) is expected to pause but leave the door open for further hikes.

 In Tuesday’s session, the USD/ZAR faced some selling pressure and declined to 18.933, down by 0.25%, and seems to be on its way to retest the 20-day Simple Moving Average at 18.880.

All eyes are on Wednesday. South Africa reports the August Consumer Price Index (CPI) with the headline figure expected to increase slightly to 4.8% YoY, while the core inflation rate is anticipated to remain stable at 4.7% YoY. Retail Sales from July are expected to come in at -1.0% YoY, compared to the 0.9% YoY decrease in June. Regarding the South African Reserve Bank meeting on Thursday, the decision will likely be to maintain its interest rates at 8.25% despite some previous expectations of a hike. As for now, for the next twelve years, markets aren’t foreseeing any hikes and discounts that the bank will maintain rates at 8.25%.

On the Fed’s side, Markets expect the bank to keep rates steady at 5.25-5.50%, but Chair Powell will likely show a hawkish tone and signal future rate hikes which could benefit the USD. Strong US economic performance, especially in services, and a mixed labour market suggest the Fed may leave room for one more hike to curb inflation risks.

USD/ZAR Levels to watch 

 The daily chart shows signs of bullish exhaustion for USD/ZAR. The Relative Strength Index (RSI) indicates a neutral stance above its midline, displaying a flat slope in the positive territory, while the Moving Average Convergence (MACD) presents neutral red bars. On the bigger picture, the pair is above the 20,100,200-day Simple Moving Average (SMA), suggesting that the bears are struggling to challenge the overall bullish trend.

 Support levels: 18.880 (20-day SMA), 18.728 (100-day SMA). 18.500.

 Resistance levels: 19.000, 19.050, 19.150.

 USD/ZAR Daily Chart

USD/ZAR

Overview
Today last price 18.933
Today Daily Change -0.0688
Today Daily Change % -0.36
Today daily open 19.0018
 
Trends
Daily SMA20 18.8827
Daily SMA50 18.5785
Daily SMA100 18.7397
Daily SMA200 18.2589
 
Levels
Previous Daily High 19.0902
Previous Daily Low 18.9346
Previous Weekly High 19.1283
Previous Weekly Low 18.7634
Previous Monthly High 19.2985
Previous Monthly Low 17.8264
Daily Fibonacci 38.2% 18.9941
Daily Fibonacci 61.8% 19.0308
Daily Pivot Point S1 18.9275
Daily Pivot Point S2 18.8533
Daily Pivot Point S3 18.7719
Daily Pivot Point R1 19.0831
Daily Pivot Point R2 19.1645
Daily Pivot Point R3 19.2387

 

 

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