BRICS currencies movement for the week – 14 August 2020

After recent Rand weakness, it was great to see some positivity in ZAR this week. Yes, I know that the weakness was due to some USD recovery and the weakness was in line with other Emerging Market currencies.

BRICS currency/USD movements for this week:

Brazil +0.3%
Russia +1.3%
India +0.1%
China +0.3%
South Africa +1.4%

Euro /USD +0.5%

Technically, the ZAR remained outside the parallel channel, with May 2020 weakness of R17.65 being test again this week. We however did not see a proper break above R17.65 yet. We saw the Rand recover in the latter part of the week to close below the 8-day Moving Average ( EMA ).

I will still be monitoring the R17.65/USD level in the early part of this coming week. A break and close above the 8-day EMA at R17.38 could very much bring these levels back into play. Should we break above R17.65, the next target becomes R18.35.

If the ZAR stay below the 8-day EMA and a close below R17.35, we could see strong support at R17.15. A break and close below this level could see the ZAR trade back at the 200-day EMA (R16.55).