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Daily Dose

Daily Dose

Good Morning,

On the wires…

  • Russia says it’s going to make ‘significantly’ more profits from energy exports this year
  • Mercedes Benz to recall a million cars globally over fear of faulty brakes
  • Explosions rock Ukraine capital Kyiv after weeks of relative calm
  • Even R350 in support from family will disqualify SA’s poor from SRD grants
  • Nadal wins French Open triumph
  • Wales spoil Ukrainian dreams to reach first World Cup in 64 years

Quote of the day…

“People grow through experience only if they meet life honestly and courageously. This is how character is built.” – Eleanor Roosevelt

The indicators…

Currency crackdown…

FXOne would like to thank Warrick Butler from Standard Bank for his contribution to the crackdown this morning.

Good morning

Current level: 15.4800/15.4900

Range last week: 15.3800-15.7000 and NY Friday close: 15.5500

I was saying to a colleague last week that its quite scary how out of control the mass killing by firearms has become in the USA. CNN reported last week that there have been 233 mass shooting, resulting in multiple deaths so far this year. That’s more than one a day which is mind-numbing. The US president is referred to quite frequently as the most powerful man in the world, but it appears that is a massive exaggeration. That honour should probably be bestowed on Cotton Charles, the president of the NRA as it seems he is accountable to no one. Joe Biden can talk all he wants but the senate appears unfazed and resolute in their stance on gun ownership, whilst the rest of the world just shakes their heads.

As bad as it seems over there, especially in light of so many colleagues and friends emigrating to the Land of the Free, we also have our own mass killings in the country, which somehow also appear to be a daily occurrence. Not the murders mind you, which for the first quarter of this year were astronomical, I am talking about road deaths and the insane number of multiple deaths from pile ups the country has experienced this year. Having to run the gauntlet back to the office these days, it’s no longer surprising. The two years of Covid seem to have made people forget how to drive, any rules of the road and which colour is meant to be Go or Stop. Unfortunately, the carnage didn’t just happen on the roads, as two days of the Queen’s jubilee holidays in the UK coincided with the all-important US employment data last week. The illiquidity and volatile nature of the Rand meant that there was blood all over the Spot trading desk by the end of last week

Elsewhere Asian markets have started positively this morning, as China continues to slowly open back up again after a long Covid lockdown. Hopefully, this starts to ease supply pressures (and this inflation fears) over the coming weeks, however there are also other socio and political economic issues to contend with. Putin upped the ante in the Ukraine suggesting new targets, should the US become more involved by supplying long-range missiles to the Ukraine. The US on the other hand has apparently launched 8 missiles in conjunction with South Korea as their response to the recent STBM launches by the despot and his army commanders. If it feels like the world is a tinder box waiting for the spark, then at least I am not alone. Or maybe it’s just the Monday blues.

The Rand is a mess, as is my trading. It is struggling to break and maintain a move below 15.4000 and yet we consistently are printing lower lows and lower highs. I have been guilty of trading what I think and now what I see. Although to be fair, being given a helicopter full of USD by the exporters every morning comes with its own issues when the market is trading in lots of $1mio per every cent. Liquidity is that poor or was at least such over the UK long weekend. Amazing how much they add when they are in the office instead of buying trinkets and swigging pints.

Overall, I suggest that the trend is still your friend, as hard as it is to fathom. With strong US employment coupled with slightly less price pressures, the pull back in equities and therefore riskier assets looks likely to continue albeit slowly and ungainly. Resistance at 15.6500 looks a great area to sell USD if we get back up there and we could see further erosion of the Dollar’s value below 15.38/15.40

Good luck out there and have a good week ahead

Support levels – 15.4000, 15.2800, 15.1500

Resistance levels – 15.6500, 15.85/90, 16.2000, 16.3500, 16.5000

On the radar…

  • All – Russia/Ukraine Crisis

Paste here…

Did you know?

Over 1 billion people tuned in to watch the 2018 FIFA World Cup final.

Have a lovely week,

Wayne

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