Gapex Gut Feel Report 3rd July 2017

Rates
USD / ZAR: 13,0537
EUR / ZAR: 14,9079
GBP / ZAR: 16,9721
ZAR / JPY: 8,6068
EUR / USD: 1,1411
GBP / USD: 1,2993
USD / JPY: 112,52
Ø ZAR remains range bound
Ø Zuma scolds his elders who are asking for his resignation
Ø ANC Policy conference will keep ZAR on its toes
Ø International Market running out of patience
ZAR on Friday saw two-way trade, keeping the currency range bound, as the weekend ANC policy conference which descended into a farce as the President used his speech or veered from his speech to chastise his Cadres, who have called for him to stand down. International market is running out of patience on the ANC Gov’s fiscal policy which remains precarious. Once again, the ailing state carrier SAA was bailed out by treasury to the tune of R2,3 bn as the International Bank has opted not to roll the loan which matured at month end. This surely must worry the ANC Gov at the waning confidence in Government SOE’s financial management. Speaker of the house must still decide on the secret ballot on the vote of no confidence, which to me is a no brainer as it won’t be allowed, as this could risk what the Zupta critics don’t want to hear. ZAR will be kept on its toes over the next week, while we wait for some credible rhetoric to emanate from the policy conference. Talking to traders they remain small long USD. Trading range 12.90-13.50,
Economic Data: 3rd July
Ø SA Barclays Manf PMI Ø ADP Employment Change
Ø US Market US Manf PMI
Ø US ISM Manf

USD/ZAR Hourly Candle

 

I would buy into weakness with a stop under R12.90.

If R13.14 goes then we could be in for a rough ride.

  

  “The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer. They will die poor.”

Jesse Livermore

USD/ZAR Daily Close

With a daily close under R12.80 now the key level, we are quietly bullish until the R13.13 level is well and truly broken!

“All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical formations and patterns recur on a constant basis.” – Jesse Livermore

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