July 02, 2024 14:28 GMT
ZAR: USDZAR Extends Impressive Bounce Off Monday’s Low
ZAR
USDZAR has extended the bounce higher from Monday’s low to around 3.5%, up 1.2% on the day and back above the 50-day EMA. Initial resistance at 18.5281, Friday’s high, has been breached in recent trade.
- While the deal reached between the ANC/DA over cabinet positions in the government of national unity initially supported the rand at the start of the week, suggestions among local press that the cabinet has received mixed reactions from labour federations and opposition political parties has since contributed to the reversal lower for the local currency.
- The moderate pull lower for the USD index and the recovery in equities has been unable to limit downside momentum for the rand, which is the poorest performer in the EMEA region today by some margin.
- For USDZAR, a bearish theme has remained intact overall, bolstered by spot piercing key support at 18.0290 on Monday. However, the daily close back above this level and subsequent price action may threaten this theme, with a stronger reversal higher potentially refocusing attention on 19.0054, the Jun 6 high.
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