It is very difficult to keep a third world countries currency stable, especially with so much economic influence. The Rand has maintain a relatively stable price for about a decade and a half. It was only when huge political influence sent the country to a new low. When Jacob Zuma became president in 2009, the currency only began to fall. By the end of his presidency the currency fell to an all new low against the US Dollar. Many people lost money and businesses closed.
The South African Rand is the second strongest currency in Africa behind the Nigerian Naira. These two currency are mainly compared to the US Dollar and could be big part of Africas economic stability and power. The US Dollar vs the South African Rand, is one of the most traded pairs in South Africa, as the movements have become due to the huge price movements, due to political impact. Traders are making a lot of money with this pair, especially in recent weeks. The currency has been taking a nose dive since their was huge political unrest in the country. Although the currency dipped, it was able to recover really quickly, again traders made a lot of money trader this fundamental signals. It is evident that the Rand will continue to fluctuate in this fashion and traders stand to make a lot of money if they are focused and catch the news early. Traders should watch news outlets for the latest information, as well as, combine this with their other analysis to create confluence and not miss out on all these pips.
Although this pair is not a major, the huge upcoming movements make this pair one of the biggest trades yet. It is almost certain that the South African currency will reach new lows, due to this political unrest. The lower the currency gets the more certainty traders have on how to trade the pair. This upcoming fluctuation is definitely not one to be missed.
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