South African Rand Dollar Forecast: USD/ZAR Edges towards 15.00, FED takes center stage
USD/ZAR Price Outlook:
- USD/ZAR price action remains supported below 15.00
- US Economic Data remains at the forefront of risk-sentiment (at least for now)
- Fed remains under pressure amid heightened inflationary concerns
USD/ZAR has turned positive after breaking above the key psychological level of 14.00 that previously held bulls at bay. With the political turmoil recently weighing on the volatile ZAR, the key psychological level of 15.00 currently remains in sight as investors and traders focus on important US economic data, (namely tomorrow’s Fed Interest rate decision) may further assist in the catalyzation of price action for the imminent move.
DailyFX Economic Calendar
USD/ZAR Price Setup
Economic and political instability are critical flaws that continue to hinder ZAR’s future trajectory. After experiencing a strong bull run that saw USD/ZAR test the 13.4 level (last seen in August 2018), prices have since rebounded towards the next key level of resistance currently residing at 15.00.
The move comes after a combination of violent protests, riots and a lagging vaccination program saw the Emerging Market Currency (EM) giving back a large portion of recent gains against it’s major counterparts, pushing USD/ZAR price action higher.
USD/ZAR Daily Chart
Chart prepared by Tammy Da Costa, IG
With price action currently trading above both the 8 and 34-period Exponential Moving Average, a break above critical resistance of 15.00 cannot be ruled out as the MACD remains in positive territory.
Should bulls successfully clear this next hurdle (of 15.00), further upside may prevail until reaching 15.43, the 61.8% Fibonacci retracement level of the 2016 – 2018 move.
However, should bearish momentum regain traction, a shift in risk sentiment may provide bears the opportunity to drive prices back towards 14.00.
--- Written by Tammy Da Costa, Analyst for DailyFX.com
Contact and follow Tammy on Twitter: @Tams707
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.