BRICS currencies movement for the week – 17 April 2020

I’ve got good news and bad news on the Rand this week. Let’s start off with the bad. After being the best performing BRICS currency last week, it fell back this week and ended up being the worst performing BRICS currency this week. The good news was that this was mainly due to the surprise repo interest rate cut of 1% earlier this week (14 April).

BRICS currency/USD movements for this week:

Brazil -2.5%
Russia -0.3%
India -0.9%
China -0.5%
South Africa -4.1%

Euro/USD -0.5%

Technically, the ZAR finds itself back above all four the 8-, 21-, 50 and 200day Moving Averages (EMA) and very close to move back into the parallel channel. Should we see this happening, next stop could very much be the testing of R20/USD.

The 14-day RSI still finds itself heavily overbought (oversold from a ZAR perspective) but improving. We can clearly see that the recent Momentum in the USDZAR, is also subsiding.

Should we however see a break and close below the 21-day EMA (R18/USD), could bring the 50-day EMA (R17) back into play, with a break and close below this level, most probably looking to test the very important R15.50 support level again.