USD/ZAR Could the Rand Recover Soon? WARNING: READ ALL CONTENTS
Please let me preface..this post is for educational purposes. It does not constitute a signal. It is a study. If you enter this trade you do so at your own risk. This pair is extremely volatile. Please read this post in entirety
DO NOT place a short on this pair until you see confirmation that this idea is coming to fruition. Right now we are far off and I am looking at this from a very high level.
From a High Level Fundamentals Standpoint
The rand is still under significant pressure and has reached a weekly low that has not been seen since October 2018. .Economic data released are not helping the rand to gain strength. However, at any time, positive changes can be made whereby investors could gain more confidence in the state of the economy and the rand can strengthen.
From a Technicals Standpoint
Important things to note:
- This pair has touched highs on all levels (monthly, weekly daily). However, this does not mean that this pair will not trade higher. I have noted a current key area of resistance. I say current for the main reason: market dynamics. The market is dynamic and changes on a daily basis. As we study price action and as the market moves the market has the ability to reach new levels of resistance and support (as we have seen over this past week). So with that being said, what is a current zone of resistance can change somewhat from day to day even.
- I have used several confluences to mark a relatively important key area of support. Will the market move to this point over the next days or weeks, it is not promised. But I will note that this area is a key area.
- We see market structure, and it's currently being contained in what appears to be the makings of an ascending wedge. HOWEVER, at any time, price action could breach this structure to the upside (refer back to point #1)..I hope you can see the cycle and level of uncertainty involved.
What I do encourage us all to do:
1. Study price action. Price action will give us an idea as to the sentiment of the market
2. Study the market for key levels, which I mentioned can change.
3. Study candlestick analysis so that you can recognize significant changes as they are occurring in the market.
4. Study the market for confluences.
5. Keep fundamentals in mind. The fundamentals give us an idea of the overall economic conditions which impact our trading decisions.
6. Although we keep fundamentals in mind, nothing trumps market structure. I always say, know the fundamentals, but know even better the technicals.
7. IMPORTANTLY FOR THIS PAIR: enter trades at key levels in the market. This way you have the most favorable risk to reward set up. We know this pair is volatile and the pullbacks alone can have you rethinking your trading decisions.
8. VERY IMPORTANT ALSO Always always always, protect your capital. Use stop losses and manage your risk. Do not over leverage no matter how good a trade idea looks. Building your account slowly is the best way to stay in the market for tomorrow and the days to come.
Thanks for reading; please like/comment and also please follow me on Instagram and Facebook (links below). Please also check out my previous analysis on some of my favorite exotic pairs. Exotic pairs are my favorite!
PLEASE FLAG THIS POST IN THE BOTTOM RIGHT HAND CORNER TO GET UPDATES ON MY COMMENTS ALONG THE WAY. YOU MUST FOLLOW NOT ONLY ME BUT THIS IDEA FOR NOTIFICATIONS.
DO NOT place a short on this pair until you see confirmation that this idea is coming to fruition. Right now we are far off and I am looking at this from a very high level.
From a High Level Fundamentals Standpoint
The rand is still under significant pressure and has reached a weekly low that has not been seen since October 2018. .Economic data released are not helping the rand to gain strength. However, at any time, positive changes can be made whereby investors could gain more confidence in the state of the economy and the rand can strengthen.
From a Technicals Standpoint
Important things to note:
- This pair has touched highs on all levels (monthly, weekly daily). However, this does not mean that this pair will not trade higher. I have noted a current key area of resistance. I say current for the main reason: market dynamics. The market is dynamic and changes on a daily basis. As we study price action and as the market moves the market has the ability to reach new levels of resistance and support (as we have seen over this past week). So with that being said, what is a current zone of resistance can change somewhat from day to day even.
- I have used several confluences to mark a relatively important key area of support. Will the market move to this point over the next days or weeks, it is not promised. But I will note that this area is a key area.
- We see market structure, and it's currently being contained in what appears to be the makings of an ascending wedge. HOWEVER, at any time, price action could breach this structure to the upside (refer back to point #1)..I hope you can see the cycle and level of uncertainty involved.
What I do encourage us all to do:
1. Study price action. Price action will give us an idea as to the sentiment of the market
2. Study the market for key levels, which I mentioned can change.
3. Study candlestick analysis so that you can recognize significant changes as they are occurring in the market.
4. Study the market for confluences.
5. Keep fundamentals in mind. The fundamentals give us an idea of the overall economic conditions which impact our trading decisions.
6. Although we keep fundamentals in mind, nothing trumps market structure. I always say, know the fundamentals, but know even better the technicals.
7. IMPORTANTLY FOR THIS PAIR: enter trades at key levels in the market. This way you have the most favorable risk to reward set up. We know this pair is volatile and the pullbacks alone can have you rethinking your trading decisions.
8. VERY IMPORTANT ALSO Always always always, protect your capital. Use stop losses and manage your risk. Do not over leverage no matter how good a trade idea looks. Building your account slowly is the best way to stay in the market for tomorrow and the days to come.
Thanks for reading; please like/comment and also please follow me on Instagram and Facebook (links below). Please also check out my previous analysis on some of my favorite exotic pairs. Exotic pairs are my favorite!
PLEASE FLAG THIS POST IN THE BOTTOM RIGHT HAND CORNER TO GET UPDATES ON MY COMMENTS ALONG THE WAY. YOU MUST FOLLOW NOT ONLY ME BUT THIS IDEA FOR NOTIFICATIONS.
Comment:
We see price is attempting to break resistance. No impulsive movement in either direction. We are looking for impulse movement before entering. Please keep watching.
Comment:
Not looking good for the drop! If you entered beware! What we wanted to see was impulse down for this idea. The bulls are not giving up easily
Order cancelled
Comment:
What I do not like..that I see. Notice the bullish engulfing candlestick. This indicates more bullish momentum at the present time. This is why we wait and watch for confirmation. It saves your capital. Please see the demonstration below.
