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Johannesburg - The rand softened against the dollar on Tuesday, tracking weaker euro movement against the US currency.
At 9:03 the rand was bid at R7.0201/$, from R6.9896/$ at the previous close. The euro was bid at $1.3707 from $1.3675 overnight.
"We broke through the initial resistance level of R6.99 against the dollar, with the next level at R7.03, tracking the euro," a local dealer said.
RMB analysts said in a morning report that global markets are coming under some profit taking pressure after a stellar run.
"Most importantly for the rand, the euro/dollar rally has faded somewhat, moving back from 1.3800 to under 1.3700.
"Perhaps this is not surprising when one considers that speculative long positions are at their highest level since the subprime crisis. Part of it also includes concerns over Ireland and Spain, a reminder that the Pigs problems are still lurking," the analysts said.
RMB said that dollar/rand rate had dragged higher in line with the international moves. In the sense that some of the move is caution ahead of the dominant US non-farm payroll data out on Frida,y there is clearly scope for levels above R7.00 to begin to dominate.
"Indeed, with local bonds selling off with the rand it seems clear that foreigners are also taking some profits in their extended positions. US dollar/rand though would have to get above R7.20 for the technical picture to turn. Overall the US dollar/rand upside seen yesterday seems more just a temporary bout of caution than any change in trend," RMB said.
At 9:03 the rand was bid at R7.0201/$, from R6.9896/$ at the previous close. The euro was bid at $1.3707 from $1.3675 overnight.
"We broke through the initial resistance level of R6.99 against the dollar, with the next level at R7.03, tracking the euro," a local dealer said.
RMB analysts said in a morning report that global markets are coming under some profit taking pressure after a stellar run.
"Most importantly for the rand, the euro/dollar rally has faded somewhat, moving back from 1.3800 to under 1.3700.
"Perhaps this is not surprising when one considers that speculative long positions are at their highest level since the subprime crisis. Part of it also includes concerns over Ireland and Spain, a reminder that the Pigs problems are still lurking," the analysts said.
RMB said that dollar/rand rate had dragged higher in line with the international moves. In the sense that some of the move is caution ahead of the dominant US non-farm payroll data out on Frida,y there is clearly scope for levels above R7.00 to begin to dominate.
"Indeed, with local bonds selling off with the rand it seems clear that foreigners are also taking some profits in their extended positions. US dollar/rand though would have to get above R7.20 for the technical picture to turn. Overall the US dollar/rand upside seen yesterday seems more just a temporary bout of caution than any change in trend," RMB said.
