Topic: South Africa ZAR IR exp 19/20 m late May 20 2021
What does the data mean to the market?
Higher interest rates are great for the value of the currency. Higher interest rates will create a BUY on ZAR Pairs and vice versa.
We see deviations often. We have seen four deviations since November 2018. Which is great from a bi monthly report.
April 2020 - We had a surprise cut of 1.5%, it was unscheduled, and the market wasn't ready to react. We don't have a chart for this, as it's an infrequent scenario.
March 2020 - An excellent cut of -0.50 gave a 1600 pip move over 3 mins. Not on the chart the data arrives 9 mins late, so the chart time is 13.09
See charts here.
Historic deviations and their outcome
January 21 2020 A surprise -0.5% cut to the rate which gave a solid 700 pip move on USDZAR. Awesome move
Its worth noting that the delivery time of this data was 9 mins past the hour.
Check out the price action here:
I will use forecasts of:
Interest Rate Decision 3.5
Today's trade plan
If we see a -/+ 0.25 deviation in either direxction , then we can expect the market to go into shock, I would target a total move of at least 800 pips which should provide multiple opportunities to enter and bank some nice pips.
Hope this helps but please do your own analysis!!
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