This is a general trend analysis of the South African Rand, using the USDZAR as a study. It recommends selling the Rand (Long USDZAR, EURZAR, GBPZAR) to buy USD or other currencies. The analysis is meant for individuals who might hold Rands with a view to sell them to move to another country.
Analysis points to the fact that now is a good time to start the process of selling Rands. The RSI has recently been oversold, this also corresponds with the lowest low of the recent trend. Since then there have been two higher lows, with the recent high being passed and the previous high nearing being passed. If the price goes above the 13.96 high then the previous down trend will have likely ended. Therefore a good time to go long on this pair (sell Rand). There are chances of retracement lower, these will merely be opportunities to sell the Rand (buy / go long USDZAR).
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Long term reversal of the Rand (USDZAR and EURZAR) has had strong confirmations with the break of resistance at 13.96 / 14 highlighted above. Now we look to short the Rand during periods of strength.
Great analysis. Love how you've come at this from a fundamental aspect. Do you still trade USDZAR? Any updated charts? I'm up for sharing mine!
Quadricolor
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@jazyyyyy, I still follow the USDZAR but am not currently trading it. However a great Triangle set up is occurring right now. Here is a link to the updated idea: Also the positive interest rate differentials and good economic fundamentals of South Africa are bullish for the Rand (USDZAR bearish). Please share with me your charts, I'm always interested in the Rand!
jazyyyyy
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@Quadricolor, Thanks for the prompt response. Yes I have the same. I have only been trading USDZAR for the past few months. I find that it's relatively easy to trade, just have to watch out for rejection candles on smaller timeframes (when day trading).
Here is my current chart for it, with my entries both longs and shorts.
I am expecting it to aldo move very bearishly however I am only dubious due to the 3rd touch of the bottom TL. Let me know your thoughts!
Quadricolor
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@jazyyyyy, Yes, there is potential for a rebound off support and then the pair going long. In that case we would take the long position on break of the upper resistance of the triangle. We can take advantage of either situation, long or short break. In this case it is not important which way the price action goes, only that we go follow the direction of the price, the direction of the breakout. Being right is not important, only listen to the price. Just wait for the breakout in whichever direction and follow it with stops and risk management in place. Your analysis certainly highlights the resistance and support areas, now just follow where the price leads you.
Quadricolor
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@jazyyyyy, Another thing I noticed looking at your analysis, in general is that on the 6 Hr chart the price seems to be held in a bearish trend within a bearish channel. The trend is your friend! Also look to the fundamentals, right now the US government is in a shutdown, I think traders have not factored in how stubborn the US President is and how long this could go on. It could turn very $ negative if the US government is unable to break its stalemate.