BRICS currencies movement for the week – 4 September 2020
Stable week for the Rand, trading below R17/USD for the whole week, but struggled to break the R16.50 level.
BRICS currency/USD movements for this week:
Brazil +1.7%
Russia -1.8%
India -0.2%
China +0.3%
South Africa -0.1%
Euro /USD -0.5%
Technically, the ZAR remained above both the R16.50 resistance level as well as the 200-day Moving Average (EMA). It did however end the week off by closing just below the 200-day EMA and we will need to see if the break is confirmed on Monday.
If the ZAR stay below R16.50 and break below R16.40 (July’s resistance level), could only see real support only coming in at R15.50.
I am however over the shorter-term, a bit worried about the recently formed Inverse Head and Shoulders formation. This in theory means that if we do not see a formal break below both the R16.50 resistance level and 200-day EMA, could very much see the Rand test R17.65 again over the medium-term. We saw a similar movement after the “head” formation, which will have me monitoring these levels close over the next week.
Luckily the 14-day RSI don’t find itself in EXTREME oversold (overbought if you’re looking at the ZARUSD) territory yet, like in the case with the “left Shoulder”, but will still prohibit me from going long of the ZAR until we’ve seen the confirmation. Wait for a formal break and close below R16.40.
Investors looking to short the ZAR (or who’s currently considering taking money abroad, in USD), should maybe do so if the USDZAR break above R16.85 again (into the right shoulder).
BRICS currency/USD movements for this week:
Brazil +1.7%
Russia -1.8%
India -0.2%
China +0.3%
South Africa -0.1%
Euro /USD -0.5%
Technically, the ZAR remained above both the R16.50 resistance level as well as the 200-day Moving Average (EMA). It did however end the week off by closing just below the 200-day EMA and we will need to see if the break is confirmed on Monday.
If the ZAR stay below R16.50 and break below R16.40 (July’s resistance level), could only see real support only coming in at R15.50.
I am however over the shorter-term, a bit worried about the recently formed Inverse Head and Shoulders formation. This in theory means that if we do not see a formal break below both the R16.50 resistance level and 200-day EMA, could very much see the Rand test R17.65 again over the medium-term. We saw a similar movement after the “head” formation, which will have me monitoring these levels close over the next week.
Luckily the 14-day RSI don’t find itself in EXTREME oversold (overbought if you’re looking at the ZARUSD) territory yet, like in the case with the “left Shoulder”, but will still prohibit me from going long of the ZAR until we’ve seen the confirmation. Wait for a formal break and close below R16.40.
Investors looking to short the ZAR (or who’s currently considering taking money abroad, in USD), should maybe do so if the USDZAR break above R16.85 again (into the right shoulder).