USDZAR recovered significant ground in recent months, climbing above both its 50- and 200-day simple moving averages (SMAs) to post a new five-month high of 14.74 last week. Even though the pair retreated a little afterwards, the new high at 14.74 has nullified the previous trending structure of lower peaks and lower troughs, and suggests that the medium-term outlook is now neutral.
Momentum oscillators concur with that assessment, as the RSI is flat near its neutral 50 level, while the MACD is also very close to zero.
Another wave of declines could meet immediate support near the 14.05 zone, where both the 50- and 200-day SMAs are roughly located as well. A downward violation could see the bears challenge 13.80, the low of February 26, with even steeper losses opening the way for a test of 13.22.
On the upside, the first major obstacle may be the March 28 high of 14.74. If the bulls manage to pierce above it, they could aim for 14.85 next, before the October peak of 15.06 comes into view. Another break above 15.06 would turn the picture to cautiously positive, from neutral currently.
In brief, the outlook is currently neutral, with a break either above 15.06 or below 13.22 needed to change that.