The USD/ZAR pair was into a corrective phase which could be over. The pair dropped as the Dollar Index dropped after its amazing swing higher. The price action signaled that the USD/ZAR could turn to the upside, but we still need strong confirmation before considering going long.
It remains to see what will really happen as the US data came in mixed. The ADP Non-Farm Employment Change was reported at 534K above 525K expected, while the ISM Manufacturing PMI increased from 60.8 to 61.1 points, but it has failed to reach 61.3 forecast. In addition, the Final Manufacturing PMI, Construction Spending, and the ISM Manufacturing Prices indicators reported worse than expected data.
USD/ZAR Technical Analysis!
USD/ZAR failed to stabilize below the 38.2% retracement level and now it tries to come back higher. The 15.922 stands as a static resistance. It remains to see if the buyers will be strong enough to be able to push the rate above this obstacle.
Making a new higher high could open the door for a larger growth. In the short term, it could move sideways before developing a strong upwards movement. Technically, the correction was expected to be only a temporary one, that’s why I’m looking for long opportunities.
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