Rand Stabilises After Heavy Losses This Week

The rand catches breath after a sharp sell-off, which has put it on track for the worst weekly loss against the greenback in more than a year, as the global risk environment deteriorated. Spot USD/ZAR has edged lower this morning, amid wider stabilisation in market sentiment, but still operates almost 6% above last Friday's closing price.

• When this is being typed, USD/ZAR trades at 18.6912. Bears look for losses towards the 20-EMA at 18.2136, followed by Jul 27 low of 17.4193. On the flip side, bulls keep an eye on Jul 7 high of 19.1533.
• JP Morgan said in a research note that they see further scope for rand depreciation and expect USD/ZAR to rise above the 19.00 figure amid a confluence of headwinds for the South African currency.
• The BBG Commodity Index has added ~0.4% this morning, while the precious metals subindex has shed ~0.2%, extending its recent losing streak on approach to the nearby 200-DMA.
• The FTSE/JSE Africa All Share Index charted a bullish hammer candlestick yesterday after a sharp sell-off on Wednesday, which raises hopes for a rebound. The index has crept ~0.3% higher this morning.
• A special panel prepared a report on the so-called Russiagate (the docking of Russian cargo ship Lady R at a South African seaport) and will hand it over to President Ramaphosa in due course.