Source: PaxForex Premium Analytics Portal, Fundamental Insight
The South African CPI for May is predicted to decrease by 0.5% monthly and to increase by 2.2% annualized. Forex traders can compare this to the South African CPI for April, which decreased by 0.5% monthly, and which increased by 3.0% annualized. The Core CPI for May is predicted to increase by 0.1% monthly and by 3.2% annualized. Forex traders can compare this to Core CPI for April, which decreased by 0.2% monthly, and which increased by 3.2% annualized.
The US Import Price Index for June is predicted to increase by 1.0% monthly, and the US Export Price Index is predicted to increase by 0.8% monthly. Forex traders can compare this to the US Import Price Index for May, which increased by 1.0% monthly, and to the US Export Price Index, which increased by 0.5% monthly. The US Empire Manufacturing Index for July is predicted at 10.0. Forex traders can compare this to the US Empire Manufacturing Index for June, reported at -0.2.
US Industrial Production for June is predicted to increase by 4.3% monthly, and Manufacturing Production is predicted to increase by 5.6% monthly. Forex traders can compare this to US Industrial Production for May, which increased by 1.4% monthly, and to Manufacturing Production which increased by 3.8% monthly. Capacity Utilization for June is predicted at 67.7%. Forex traders can compare this to Capacity Utilization for May, reported at 64.8%.
The USD/ZAR forecast continues to be influenced by bearish factors with US Covid-19 infection rising rapidly. The US government is expected to unveil more stimulus measures, with the existing ones running out. It will confirm that the situation was underestimated and that any recovery will require more time than existing stimuli can cover. Price action is located below the Kijun-sen and Tenkan-sen, with the Ichimoku Kinko Hyo Cloud adding downside momentum. Will bears be able to force more selling in this currency pair? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the USD/ZAR remain inside the or breakdown below the 16.4500 to 16.9200 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 16.6900
- Take Profit Zone: 15.4900 – 15.7500
- Stop Loss Level: 17.0600
Should price action for the USD/ZAR breakout above 16.9200 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 17.0600
- Take Profit Zone: 17.4900 – 17.7000
- Stop Loss Level: 16.9200
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