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Writer's picturePeet Serfontein

Analyst thoughts: USD/ZAR Medium-term

VIEW RETAINED: BEARISH CORRECTION WITHIN A LARGER BULL TREND

  • The expectation of a 1,2,3,4,5 impulsive bull trend to RA1, followed by a WXY correction to S1*, is materialising.

  • Preferred: The WXY correction to S1* is currently preferred, as illustrated, but will only be validated on a break below the interim S0 bottom.

  • Alternative: The recent downside off the RA1 target could still be part of the PQ trend-ending pattern. Failure to break S0 soon will result in another PQ-defined upward leg to P* as the new pivotal resistance.

  • If S1* holds over time then a very bullish longer-term outcome would be for impulsive upside (i, ii, iii, iv, v) to new highs is the longer-term scenario.

Target and Re-assessment Levels:

Important Levels: P* and S1*

Primary Trend: RA1*/S1 consolidation, followed by a bull trend to R2 and beyond.

Monthly Range: P*/S1*

Current Trend and Target Levels: Downside towards S1*

Technical Rating: Medium


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