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The GBP/ZAR daily chart has formed an inverse head and shoulders formation, labelled L, H and R. The pattern warns of a change in directional trend from down to up, hence the term “reversal pattern”. In this scenario the pattern suggests GBP strength and ZAR weakness to come. The height of the pattern projected from the breakout level (R16.90/GBP) arrives at an upside target of R17.65/GBP, while a close below the right shoulder at R16.55/GBP would consider the failure of the inverse head and shoulders chart pattern.
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