FX & FI Technicals
07 February 2022
Dollar/Rand Weekly Close
There is very little that I can add to the commentary as nothing has changed in the big picture.
The range remains solid for now.
Most of you will not like or believe my LT view, but alas, I am not here to appease but only to call it the way I see it, and what I see is R11.50 over the next 17 months.
I am convinced that the ZAR is in a multi-year corrective phase vs. the USD and that from today on, all upward spikes on this chart are well worth a short!
Now before everyone (who believes me) goes selling their house to fund a Dollar short position, be cognitive of the fact that this chart could easily have a leg higher and trade toward the R16.77 level in the coming weeks.
This could easily be attributed to Russia invading the Ukraine or China invading Taiwan or both, which should provide a risk – off environment, causing a quick and painful weakening of the ZAR.
An event of this nature should be seen for exactly what it is, an opportunity to sell the USD and buy the ZAR.
I will be doing some ad-hoc research on this later in the week to fully explain why I strongly feel that the above view will playout.
Until then, the range is likely to be R14.88 – R15.50 and I would seriously consider owning the bottom of the range!
Dollar/Rand Daily Candle
We missed the opportunity to get long with a few cents and are now happy to wait.
The daily chart fits into my weekly view.
I want a last leg higher into the R16’s to complete the chart. (but what I want does not count)
I want everyone’s theme for 2022 to be PATIENCE, because for what I can see across all markets is that picking our spot will be more important than ever, especially as this could be the year we encounter a wedge of Black Swans.
Dollar/Rand 240 min Candle
We missed our long with a few cents even though the diagonal worked perfectly.
But better to miss than to burn, I always say.
This chart is middle of the range but can surprise with a last leg lower before looking to trade higher.
And it’s with this in mind that I am happy to hang back another week and let the chart play out.
Euro/USD Weekly Close
This chart remains well within the triangle range, while $1.1250 remains MASSIVE support.
In the ST, should we see this chart move back over $1.450 – $1.16! – This is currently underway.
US Dollar Index Weekly Candle
I am changing my view until further notice, and I think we are headed back to the 88.00 level over the next few months.
The chart’s upside momentum has failed. IMO
SA Government Bond 30 Year Yield Daily Close
#No Change in Commentary
The chart is very range-bound, and all I can add from here is that the top of the range (11.40%ish) will be a fantastic buy as the more significant formation is starting to appear more and more like a consolidation for a severe leg lower.
The chart is also kicking very nicely off over sold levels.
US Government Bond 30 Year Yield Weekly Close
#No Change in Commentary
This chart is heading to 3.00% in my opinion.
I would buy any move back the MT trend line!