The USDZAR pair is currently sitting in the consolidative blue triangle. As long as the DXY remains below 92.800 and platinum stays above $1015, I expect the pair to complete an ABC corrective pattern.
A break above the 200-week MA rate of 14.59 could however see the pair move into the range between 15.50 and 16.00.
The fundamentals that drove the rand stronger in 2020 and the first half of 2021 are still present. SA is still holding a healthy trade surplus, the rand still has strong carry trade appeal and commodity prices remain stable. I remain doubtful that the FED will taper their minimum $120 billion in asset purchases this year despite their recent hawkish monetary policy stance.
China’s credit impulse has recently turned negative which could weigh on commodity price growth in the next two quarters but the news that China cut their reserve requirement ratio by 0.5 percentage points earlier today has me remaining bullish on commodity prices (Chinese credit expansion will support commodity demand).