Rand Dollar Price Action:
- South Africa enters into level 4 lockdown restrictions, business confidence falls
- USD/ZAR Volatility remains heightened in anticipation of NFP’s
- Visit the DailyFX Educational Center to discover why news events are Key to Forex Fundamental Analysis
South Africa has entered into Level 4 lockdown in an attempt to curb the spread of the new Delta variant that continues to spread panic across the nation. Although USD/ZAR price action has remained on a downward trajectory (YTD) against the US Dollar, the combination of fear and uncertainty is expected to weigh on the volatile Rand, as hopes of a swift economic recovery falter.
Source: Refinitiv
USD/ZAR Technical Analysis
A shift in risk sentiment has provided USD/ZAR bulls the opportunity to regain control over the short-term systemic trend, pushing prices into a level of resistance, formed by the 38.2% Fibonacci retracement level of the March – June move at 14.23. Although the downward trajectory persists for now, prices remain above both the 20 and 50-Day Moving Average while the Standard Deviation (a measure of volatility) remains heightened.
USD/ZAR Daily Chart
Chart prepared by Tammy Da Costa using IG
Non-Farm Payrolls Takes Center Stage
With global inflationary concerns gaining traction, this Friday’s release of Non-Farm Payrolls has the potential to catalyze price action further, if Non-Farm Payrolls places further pressure for tapering.
Source: Refinitiv
— Written by Tammy Da Costa, Analyst for DailyFX.com
Contact and follow Tammy on Twitter: @Tams707
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