USDZAR
Updated
The USDZAR pair is currently trading in a tight range between 18.22, the 200-day MA resistance rate, and 17.90, the 38.2% Fibo retracement level. These are the critical rates I’m watching in the lead up to the last non-farm payrolls print for the year this Friday. Additionally Fed chair Powell will also speak later this week.
My original idea for a 5-wave impulse higher towards 18.50 is still on the cards in my opinion and a break above 18.20 will confirm this move. A break below the blue support range between 17.85 and 17.90 will however invalidate my original idea.
The DXY and US10 year yields have turned around last week however I believe the DXY still has room to make another leg higher before the end of the year which is rand negative.
Please also see the DXY chart attached.
DXY:
My original idea for a 5-wave impulse higher towards 18.50 is still on the cards in my opinion and a break above 18.20 will confirm this move. A break below the blue support range between 17.85 and 17.90 will however invalidate my original idea.
The DXY and US10 year yields have turned around last week however I believe the DXY still has room to make another leg higher before the end of the year which is rand negative.
Please also see the DXY chart attached.
DXY:
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The non-farm payrolls print last week was a non-event however it did come in stronger than expected which is dollar positive in my opinion. This week the US CPI for Nov will be released on Wednesday and anything inline or above expectations will put another gust of wind in the dollars sails.
I'm planning to pull the trigger on the idea this week. Buy orders between 17.95 and 17.85. Stop loss around 17.75 and 50-day MA at 17.70.
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