USDZAR weekly trend at crossroads. Levels strongly supported.
Updated
At first I thought that the USDZAR downtrend had been halted and a new uptrend started. However, price has respected a previous important high (August and November 2016)and has quickly moved down to just break past and sit at the previous low set March 2016. Currently it looks more like a long term range forming. The latest up moves were from potential political difficulties, then with the new ANC presidential election the pair moved down rapidly. There may be a further political wrangling until the elections in 2019 and it is likely to cause swings both up and down (difficult to predict).
Technically there is very good support at these levels and prices have held, however the levels have been broken. If the price continues strongly downward then a new down trend could start. If prices rise from this level, it could get stuck between these two levels (12.30 to 14.50). I am neutral at this immediate moment as I am waiting for price to determine what will continue to happen, it could go either way. Also if the range sets up then this too adds to the neutral stance which may be opportune for range trades.
There are opportunities to buy now with a stop just below at around 12.00 or 12.10 with the view to targets at 14.50. There is also an opportunity to sell as price could continue the general trend of the last two years. I am leaning more towards the side of Long at this moment as the RSI is very low (though currently bearish) and may be displaying bullish divergence. To be safe, we wait for confirmation from price action, with a smaller trade by money management for a long trade with space in the stop loss for a fake out.
Technically there is very good support at these levels and prices have held, however the levels have been broken. If the price continues strongly downward then a new down trend could start. If prices rise from this level, it could get stuck between these two levels (12.30 to 14.50). I am neutral at this immediate moment as I am waiting for price to determine what will continue to happen, it could go either way. Also if the range sets up then this too adds to the neutral stance which may be opportune for range trades.
There are opportunities to buy now with a stop just below at around 12.00 or 12.10 with the view to targets at 14.50. There is also an opportunity to sell as price could continue the general trend of the last two years. I am leaning more towards the side of Long at this moment as the RSI is very low (though currently bearish) and may be displaying bullish divergence. To be safe, we wait for confirmation from price action, with a smaller trade by money management for a long trade with space in the stop loss for a fake out.
Note
Price continues down and has broken support. Trend is confirmed down. Rand strengthening as dollar continues weak trend. This may continue.
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