The USD/ZAR is near the 17.76000 vicinity in early trading this morning, which has seen extreme bids and asks demonstrated on brokerage screens, this as financial institutions brace for volatility to come.
Readers should check on the published price of the USD/ZAR as they read this article to compare it to the early volatility being seen now. Financial institutions clearly will be careful as they position their Forex as U.S players get back into the game today, this as they return from their long holiday weekend. Traders should look at the trading results from Friday and early this morning with a great deal of suspicion.
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While technical charts show large spikes early this morning, they actually were caused by outlandish bids and asks simply being produced without a lot of real trading results. Speculators who are new to Forex need to understand currency pairs like the USD/ZAR rely heavily on the whims of commercial transactions. Because of the U.S Independence Day celebrations last Friday, today in essence will become a catch up day and it might take a few hours for the USD/ZAR to become tranquil.
17.70000 Fixture Near-Term Moving Ahead
As calm returns to Forex and traders feel the market is presenting fair value, the USD/ZAR could see the 17.70000 realm become a fixture again. And if the value starts to see trading below the ratio in the coming hours, some will assume the lower prices seen last week will quickly return. But a warning bell should be given attention, there might be less risk appetite in Forex over the next couple of days.
USD centric weakness has been a theme in Forex and for the USD/ZAR too. The South African Rand has done well and created a rather technically efficient bearish trend. However, the 9th of July tariff deadline set by President Trump may create some headwinds for Forex traders over the next two days. While most financial institutions have shown relative calm since the fireworks of early April, history shows us nervousness can ignite quickly.
Day Traders and a Test of Nerves
While USD/ZAR traders may want to lean into bearish notions and believe this morning’s early highs are showcasing an overbought market, caution is advised along with solid risk management. The notion that the USD/ZAR should return to the 17.60000 vicinity and lower which were seen last week is tempting and may be proven correct, but it is a question of timeframes. The 17.80000 value may remain stubborn just as easily in the coming hours.
- Traders should be conservative with their wagers. Upside potential lurks, particularly if President Trump threatens to become proactive regarding his tariff penalties again.
- Yes, we have seen Forex become calm after the White House’s rhetoric before, but speculators should practice risk taking tactics that account for potential volatility to be seen the next couple of days.
USD/ZAR Short Term Outlook:
Current Resistance: 17.80300
Current Support: 17.73400
High Target: 17.87900
Low Target: 17.63200
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