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Andreas Zanin
Analysis | August 30, 2021

Best Forex Trade Setups USD/ZAR USD/NOK

In terms of the two trade setups below the long-term trend is up in USD/ZAR and USD/NOK but we have seen a pullback to major support which could present a low-risk buying opportunity. Our view of the fundamentals, sentiment, and technicals below…

Our general view is that commodities will go lower and we view all commodity currencies as long-term sells against the USD.

Fundamentals: The Outlook for Global Growth and Commodities

Norway is Europe’s biggest oil exporter and we have seen a bounce recently which has helped to firm the NOK but the big trend is down and we are looking for more weakness in crude to weigh on the NOK.

South Africa is a major commodity exporter and also relies heavily on capital inflows which are likely to decrease as we move to a more cautious view of the global economy going forward. Global PMI’s have peaked and so too has commodity demand which points to a lower NOK and ZAR.

Sentiment Speculators Short the USD

Speculators are short the USD overall and have sizeable positions short the dollar against both the NOK and ZAR which points to limited USD downside in our view. While the two pairs we will look at here, are minor pairs they offer good profit potential against risk.

USD/NOK

We made a double top into the 9.10 level and we are now trading not far from major support at 8.500 which we expect the hold the pullback – An upside breakout is expected to target chart highs.

USD/ZAR

We have seen a big correction with 6 red down days and we are now near major support at 14.60 – We view the USD as a buy on a breakout to the upside and expect a move back up to chart highs.

 

Research provided by LearnCurrencyTradingOnline.com

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