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Key Resistance Looms at 15.21 As US Real Yields Pressure EMFX

SOUTH AFRICA
  • USD/ZAR trading higher at the open, with a buoyant greenback pegging EMFX weaker after yesterday's broadly risk-on session.
  • The cross is now back above 15.00, and will need to take out 15.2116 resistance (aligns with long-term bear channel res) decisively to assert a firmer uptrend.
  • For now, USD/ZAR should trade in line with risk sentiment, which seems to be tilted to the off-side with expectations for real yields to continue to rise or remain choppy at least in the near-term.
  • ZAR remains one of the EM bright spots, however, poised to benefit from a normalization in volatility & US real yields.
  • Wage negotiations looking like an increasingly sticky battleground where the fiscal consolidation drive will either succeed or fail in 2021 – worth watching closely.
  • Commodities pulling back slightly this morning: gold -0.43%, platinum -0.90%.
  • Intraday sup1: 14.9867, Sup2: 14.9078, Res1: 15.2116, Res2: 15.3174
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com

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