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The Rand has weakened to a new all time high versus the USD briefly touching USDZAR 14.07 in overnight trade as commodity prices plunged on the back of emerging market and China growth jitters.

This move was exacerbated by large value stop-losses being triggered above the USDZAR 13.00 level creating a domino effect and fast move on all ZAR crosses with GBPZAR touching 21.00 and EURZAR breaking above 15.00.

All 3 main ZAR crosses have now broken key resistance and psychological levels at USDZAR 13.00, GBPZAR 20,00 and EURZAR 15.00 (originally breaking above 14.00) respectively creating the 'Perfect Storm' scenario for the ZAR from a technical perspective. 

It is not often that all 3 major crosses break such significant levels almost simultaneously but when it does the movements and 'run' on the Rand can be quite scary.

The reality here is that everything here is quite simply WEAK (a pretty sad and bad situation really with little to no will or acknowledgement to change the course). It's always China's fault, or that we're part of a weak emerging market story. Blah blah blah. The Rand, the economy, the political landscape, the fundamental picture, the technical scenario and so on. is quite simply insanely WEAK and as they say 'Price is King'.

Price doesn't care what you or I think and no-one can tell Price where to go. He (or she) will move as it pleases and it will always reflect the TRUTH. No argument, reasoning or excuses will change Prices mind. There is no truer truth in the markets than Price. He is neutral, unbiased and the fairest reflection of what is going on.

Logic thus tells you that if Price is trading at all time lows and has simultaneously broken massive psychological and key resistance levels then this is a KEY POINT and defining moment for the future of the Rand and we would expect to see further weakness (and possibly a very sharp move weaker) from these levels.

At the moment we are seeing a natural correction to the crazy moves from last night and it will be interesting to see where the market settles. Either way, in our opinion, the ZAR is primed to move weaker from these levels from a technical and fundamental perspective.


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Rand edges off 14-year low, China risks loom

Rand edges off 14-year low, China risks loom
Johannesburg - The rand recovered slightly early on Tuesday after touching a fresh 14-year low in the previous session as emerging markets wobble on concerns over China's economy. At 08:30 the rand edged 0.18% firmer to R12.5945/$, recovering from a...
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