USD/ZAR: Long position targeting 18.45 – TDS

FXStreet Team FXStreet

USD/ZAR is sitting below key fibo level and 50-dma at 18.04. Strategists at TD Securities open a long position on deep rate cuts and negative outlook.

Key quotes

“USD/ZAR is venturing in the lower half of the RSI range, towards oversold. The pair sits just below the 18.04 key fibo level and the 50dma. We look for a rebound higher.”

“We open a long USDZAR position in our model portfolio, with inception at 17.92 and target of 18.45. We set a stop at 17.65.”

“We expect real GDP to contract by 8.5% in 2020. The SARB, however, expects a contraction of 6.1% this year. It is very likely that there will be a further downside revision at today's MPC meeting of the SARB, while acknowledging strong disinflationary forces, which will justify a 50bps, if not larger, cut today.”

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FXStreet Team

FXStreet

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