USD/ZAR Technical Outlook: Nearly Decade-long Trend-line Looks Like Next Stop
- USD/ZAR continues lower following break of 2018 trend-line
- Next up could be a trend-line from 2011, 2019 lows
USD/ZAR continues to sell off as the Dollar in general remains quite weak versus both developed and emerging market currencies. This looks to be the case for the foreseeable future, with the possibility of some type of reversal in Q1. More on that later.
For now, USD/ZAR breaking the 2018 trend-line in recent weeks is leading to a potential test of an even more important long-term threshold. There is a trend-line rising up from 2011 that is quite meaningful in the grand scheme of things.
It currently lies down in the vicinity of the 13.70s, where there is also price support from a pair of lows created in 2019 between 13.81 and 13.91. The confluence between the long-term trend-line and lows would make for a strong zone of support.
But before we get to that point there is still some trading to be done. At this time, the trend is a little extended in the short-term, which means we could see a corrective bounce develop. With that in mind, taking an approach that takes advantage of pullbacks may be the way to go.
USD/ZAR Weekly Chart (heading towards 2011 t-line, 2019 levels)
USD/ZAR Daily Chart (may bounce before resuming lower)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.