The USD/ZAR price is down for the third consecutive day in part due to the overall weak US dollar and a return of the risk-on sentiment. The South African rand has gained more than 5% in the past few days alone.
What’s happening: The South African rand has been rallying recently. The EUR/ZAR has dropped by more than 1.30% in the past five days while the GBP/ZAR has fallen by more than 1.60%.
This strength comes even as the South African economy goes through its toughest period in modern times. The country is also seeing more coronavirus cases due to the new strain of the virus.
This week, data from the country showed that mining production declined sharply in November. And today, data showed that the country’s consumer prices rose by 3.1% while the core CPI rose by 3.3% in December. The next big event will be tomorrow’s interest rate decision by the SARB, which vowed to leave rates at 3.5%.
USD/ZAR technical outlook
On the daily chart, we see that the USD/ZAR pair has been dropping this week. This happened after the pair found a lot of resistance at the 15.64 level. This price is along the descending trendline that’s shown in black. It has also moved below the 15-day and 25-day exponential moving averages. Therefore, the pair will likely continue falling as bears target the YTD low of 14.4988.
USD/ZAR technical chart