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Rand Tops EMEA Pile as Risk-On Geopolitical Developments Support EM FX

ZAR
USDZAR has traded sharply lower in recent trade, mirroring the downtick in USD index on the back of headlines that have just crossed from Al Jazeera on the potential of a ceasefire agreement between Israel and Hamas. The developments have supported EM FX, with the rand one of the most notable beneficiaries - USDZAR spot is down 1.02% at typing, bringing this week’s total losses to 1.25%.
  • The technical trend outlook in USDZAR, however, is unchanged and bullish. The recent move down is considered corrective despite the breach below key support area around the 50-day EMA – at 18.9490 – on Thursday. Nevertheless, the pair closed above that level yesterday. A more sustained break of the average would signal scope for a deeper retracement and expose 18.3805, the Aug 24 low.

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