USD/ZAR Analysis Today - 20/01: Lower Depths Explored

(MENAFN- Daily Forex)

• After showing a vast array of nervousness was affecting the USD/ZAR into early last week, when the currency pair was trading above the 19.00000 level, a healthy dose of selling has now been seen.
• The USD/ZAR as of this writing is near the 18.68550 mark as of this writing as Forex has opened for the week.
• Traders need to acknowledge that U.S financial institutions will mostly be absent from the playing field today because of MLK Day commemoration, which is creating large spreads between bids and asks.

However, while volumes would typically be down with the absence of large American players sitting on the sidelines, make no mistake in recognizing that global financial institutions situated worldwide know that Donald Trump is being sworn in as U.S President today. Traders should be ready for potential choppiness over the next couple of days as Trump begins to initiate his powerful mandate.

Top Forex Brokers1 Get Started 74% of retail CFD accounts lose money USD/ZAR Showing Healthy Signs of Optimism

The USD has been strong in Forex since the end of September and the USD/ZAR reflected this attitude. The climb over the 19.00000 level in early January mirrored the nervousness being seen in global financial institutions, but it has been important to note that the move higher was not a stain against the South African Rand. Yes, domestic issues still abound in South Africa, but domestic financial houses in the nation are much more optimistic now compared to a year ago.

The ability of the USD/ZAR to move lower the past handful of days is a solid sign for the South African Rand. Yes, there have certainly been reversals and speculators cannot bet blindly on the USD/ZAR, but the incremental steps downwards have been solid. First the 19.00000 level was proven vulnerable, then the 18.85000 ratio saw a fight, then the 18.73000 to 18.70000 area saw trading on Friday. The early selling this morning remains suspicious because of lighter volumes and today's trading may prove to be choppy.18.70000 Level as a Barometer Today and Tomorrow

USD/ZAR traders should be cautious today and into tonight. President Trump will ruffle a few feathers certainly over the next two days and might have a few comments about international trade that will affect sentiment. Financial institutions have known Trump will be President since the first week in November, but there is always a chance for a surprising comment coming from the White House to be reckoned with from now on.

• The ability of the USD/ZAR to move lower the past few days is of interest, and the question some speculators may ask is when support levels will prove difficult and create reversals higher.
• The 18.70000 area today and tomorrow should be watched for price action.
• Traders should not get too comfortable quite yet with overly ambitious depths being explored in the USD/ZAR, some choppiness should be expected near-term.

USD/ZAR Short Term Outlook:

Current Resistance: 18.70800

Current Support: 18.65600

High Target: 18.76900

Low Target: 19.61200

Ready to trade our weekly Forex forecast? Here's a list of some of the top forex brokers in South Africa to check out.

MENAFN20012025000131011023ID1109109734