Last Tuesday (May 10th) I posted “The USDZAR broke some key levels yesterday and looks to be in a bullish up move:
- Last week it rallied to the 23.6 Fib level and the psychological round number at 15.0000.
- It finally closed above 15.0000 yesterday having reached the level in the three previous trading sessions but was unable to breach the level. So we have had a fairly typical, reach, breach and broken pattern.
- Yesterday’s close (15.1650) was also at a key level, which had previously been support, during February and March, and had turned to resistance for April. A close today over this level indicates strength for this pair.
I will be looking for Target 1 area around 15.5000 – 15.5380 and Target 2 around 16.0000 – 16.3000”
At the time the pair was trading at 15.2322 it closed the day below the important 15.1650 level and traded as low as 14.8883 on Thursday. However, following the strong US retail sales and sentiment data on Friday the pair rallied into the close and earlier today the trade reached its Target 1 for a net gain of over 300 pips.
Today’s US calendar is fairly uneventful. The May Empire State report headlines. We expect a dip to 7.0 after surging about 9 points to 9.6 in April. The May NAHB housing market index is seen improving to 59 from 58.
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Chief Market Analyst
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About Janne Muta, HotForex’s Chief Market Analyst
Janne Muta is a seasoned industry professional with over 16 years experience in the global markets. Originally from Finland, Janne has worked for institutions in both Helsinki and London as an institutional fund manager, global market analyst and FX educator.
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