I also think that the ZAR is not forming a resistance at these levels, so I think we might head back up to 10.60 (weak barrier), and then 10.90 (stronger barrier), if any negative figures come out for SA and/or Positive figures for the US.
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The ZAR Exchange Rate Thread
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I also think that the ZAR is not forming a resistance at these levels, so I think we might head back up to 10.60 (weak barrier), and then 10.90 (stronger barrier), if any negative figures come out for SA and/or Positive figures for the US.
Midnight_choir_drunk
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R10.44 at the moment. If it stays for a while at this level then we should it crawl towards the R10.00 mark ?
Not necessarily. It depends on the fundamentals. If nothing changes locally or internationally the ZAR should stay at this level.
Then you get ZAR strength / weakness and USD strength / weakness. At the moment the ZAR appreciated because of USD weakness not because of ZAR strength.
Agree, the Dollar is taking a bit of a pounding today across the board. Expecting it to come back a bit towards the EU closing around 5/6 this afternoon and then also expect the rand to get back above R10.50.
Baring a clear fundamental catalyst it won't go down in a straight line, there are just too many "buy" zones between R10.45 and R10.00. The most likely scenario is it finds support at some point between now and R10.30 and goes back up for a while. After that it could drift lower again, but before it gets to R10.00 there has to be a firm reason for those looking to buy cheaper to choose not to. There is also the 2011 trend line to get through. If that goes, well then it's off to the races at least in terms of the techs, but we're still a long way off.
https://www.tradingview.com/x/p6rgZGHA/
It will be fascinating to see what happens when it gets there.
XennoX
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When? You're implying that we will get there?
Midnight_choir_drunk
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The rand should return to around 8.5 in the next few months. It's way too undervalued at present.
Strongly doubt that. The Rand at this stage, imo, is valued right as our economy at this stage do not justify it being any stronger. There has been no significant improvement in the country's underlying fundamentals and as such no reason for the Rand to improve back to the R9/R8 levels.
Its going to take some doing to get it below R10 and a small miracle to get it below R9.00 at this stage of the game. It is possible though that it might trade under R10 later in the year i.e. around the third quarter but I doubt that.
Midnight_choir_drunk
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The current value of the rand has sweet F all to do with the state of our economy.
How do you think the value of the Rand is then determined?
I agree. I do think the Rand is slightly under valued but I can not see us breaking below 10 anytime soon. If all goes well and the greenback does not come out swinging later this year I think you are right and we will be trading at around the 10 level, I think just above it opposed to below it.
Midnight_choir_drunk
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Right now the weakness is more to do what's going outside of our control. To what do you credit the current weakness ?
As mentioned, weak fundamentals.
The line keeps on going up at some point so the two must cross, unless you think our currency will just continue going down.
Willing buyer, willing seller.
To a certain extent yes. Supply and demand. Economic factors however do play a large role in establishing the perceived value of the underlying asset being transacted. The value of a transaction is not just sucked out of thin air by each willing buyer/seller combo.
Yes but the problem with this is that an estimated 90% of trades are for speculation and the buyers / sellers would like the data to at least have an educated "guess". Fundamentals drive the exchange rate. Willing buyer / Seller is what happens when the exchange rate is at the right level. else it will depreciate / appreciate until it gets to that level.
Everyone is educated on the same "fundamentals" and therefore they all make the same guesses hence driving the currency. It's got nothing to do with actual value, beyond a speculator circle jerk.
If you look at the Rand on a purely economical value then yes it is massively undervalued. The real value should be around R6...
so why isn't it? strikes, anc, malema and bee. their worthless carcasses are what is holing the rand hostage at R10+, i can guarenflippingteee that if the strikes end, da wins and reworks bee into a private sector driven force and then makes any talk of nationalization a act of treason then out currency would make massive gains.
We need to be come a economy driven by desire for real growth, hard work and dedication.
so why isn't it? strikes, anc, malema and bee. their worthless carcasses are what is holing the rand hostage at R10+, i can guarenflippingteee that if the strikes end, da wins and reworks bee into a private sector driven force and then makes any talk of nationalization a act of treason then out currency would make massive gains.
We need to be come a economy driven by desire for real growth, hard work and dedication.
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