Sarb — Trading Ideas on TradingView

USDZAR 1Q2025 outlook The rand has been on the ropes since mid-December after it failed to pull the pair below the 50-day MA support. Since then the broad-based dollar strength has seen the rand give away all its post-election gains. Fundamentally there I only see two factors which are supportive for the rand as we head into 2025. The first is a strong SA trade surplus of R34.7 billion for November 2024 and the second is the SARB’s continued hawkish stance. The dollar has punished both developed and developing market currencies whose central banks opted to front run the Fed with their respective rate cuts last year and the SARB’s hawkish stance has limited the rand’s losses in 2024. Apart from these two factors, the overall risk-off sentiment stemming from the volatility in the US and other bond markets coupled with the fleeting post-election SA election optimism does not bode well for the rand. Technically, we have completed a five wave impulse for the pair which pushed the pair to a high of just shy of the psychological handle of 19.00. I believe we should see an ABC corrective pattern play out and a re-test of the levels around 18.40 and 18.50. A failed break below this support range will be the first sign for the predicted move higher towards the 2024 high of 19.35. A break below the 50-day MA will however invalidate the idea and allow the rand to re-test levels below the 18.00 handle. The 50- and 200-day MAs are currently sitting at 18.15 and we are seeing the infamous “golden cross” taking shape which is rand negative. Over the very short-term, the bearish divergence on the RSI could allow the rand to strengthen with today’s US non-farm payroll volatility. The USDZAR and the DXY both look overstretched and this week’s attempted move higher for the USDZAR does have the characteristics of a bull trap.

JSE T0P40 I initially predicted a 17% decline on JSE TOP40, the move is well in motion. See link below South Africa has had one of the worse lockdowns in response to covid19 and it resulted in a reported decline of 51% in GDP. The unemployment numbers and number of business bankrupted are not yet publicly available. South Africa also increased its USD debt during this crisis and in a lot of ways money meant for economic recovery was lost to corruption. During this period there's also been increases in social grants and introduction of new ones despite the decrease in production. When more of the data becomes available i think the stock market will keep falling further, though i doubt new lows could be made, but i am very convinced the we could see prices falling to a range of about 34,000 - 35,000. Share your thoughts in the comments below Like and follow for more content Link in related charts Good Luck!!!

ridethepig | Dovish SARB On Deck!We are reaching the lows in the range right on time for SARB today. Markets are expecting a 50bps move, a little bird tells me that we are set for more... Remember the domestic story in South Africa is only going one way; sadly it's the same outcome as Turkey. On the technical side, tracking closely the 18.00 support to build longs outguessing a dovish SARB. Look to target the 18.5x and 19.0x highs and lighten up below 17.7x. Good luck.

ridethepig | ZAR Market Commentary 2020.02.17 Here tracking for a very technical pullback after a test of last week's open. Positioning is incredible stretched meaning the tree can be shaken at any minute, I want to get long USDZAR but reluctant to chase anything at these levels. Tracking a pullback into the 14.7x jurisdictions before doing anymore business here. A similar move for those tracking USDTRY: A breakdown is not necessary or fundamentally attractive in both TRY and ZAR, sitting tight and looking for cheaper levels in both makes sense to me. Market might give some of the high beta currencies a bid in the illiquid flows before EM FX receives a major hammer later in the week.