In our weekly round up this week, we look at some important data released and the affect this has had on the currency market.
The greenback started off the week with a sombre stabilization, finding footing in the long weekend with Monday being Labor day.
We saw some price action on Tuesday as the pricing-in of expected GDP figures began to seep in on USDZAR, and by Wednesday we saw the pair test the resistance level of R16.95/$ after the shock release of figures.
The USD has been shrouded in volatility this week – remaining vulnerable with US-Sino China tensions continuing, policy and aid talk indecision, election nerves and jobless claims rising.
The Euro had the biggest fundamental event of the week in the much anticipated European Central bank interest rate decision, which was announced to remain at 0.00 percent.
The Euro had a strong run this week and hit its 1-week high against the USD during the Monetary policy decision announcement.
The ECB cited that it will continue to follow its pandemic emergency purchase program, as well as staying ready to provide liquidity when required.
The Pound continues to suffer an impact from discord in Brexit negotiations with the EU.
Pressure will remain on the Stirling until positive clarity is provided and the perception of chaos over a no-deal Brexit is overcome.
GBP may see a volatile day with UK GDP having been released this morning and showing a worse off drop than expected.
South African Rand
USDZAR continued to follow the same range we saw last week between R16.55/$ – R16.95/$.
A clear channel has developed within this almost 50c range, forming a triple bottom and possibly now having gassed out this sideways movement with a breakout on the cards.
This week was turbulent on USDZAR with the horrifying economic reveal of SA’s GDP declining by 51% due to the hard lockdown.
Technically : a solid support level has been proven at R16.55/$, and R16.95/$ remains the top level to be broken before we see higher prices. This range we are engaged in may be reaching its end, having been the possible consolidation after an impulsive downward trend in August, this may be the preamble to a upward move.
- Low – Best Buy At Around 19.53
- Support – 19.84
- High – Around 20.27
- Low – Best Buy Around 21.10
- Support – 21.56
- High Around 22.00
Our clients enjoy a daily market report for free when opening a business account with us. If you feel like this is adding value to your business, sign up below.CLICK HERE TO SIGN UP FOR FREE