• USD/ZAR advanced on Thursday as a firmer dollar pressured the rand, overshadowing positive domestic economic indicators.
• South Africa’s manufacturing sector showed signs of recovery in September, ending a three-month period of contraction as new orders rebounded, according to a PMI survey..
• September’s PMI marked a welcome improvement following a weak winter period, particularly as new orders rebounded sharply, South African bank Absa, which sponsors the survey, said..
• Separately, data from South Africa’s automotive industry body NAAMSA showed new vehicle sales rose 12.7% year-on-year in September, accelerating from 11.4% growth in August.
• The rand often takes cues from domestic data and global factors such as U.S. economic data and monetary policy.
• Immediate resistance is located at 16.729(Daily high), any close above will push the pair towards 16.808(38.2%fib).
• Strong support is seen at 16.508(50%fib) and break below could take the pair towards 16.373(Daily low).
Recommendation: Good to buy around 16.500 with stop loss of 16.300 and target price of 16.800
