• USD/ZAR strengthened on Thursday as the South African rand weakened amid risk-off sentiment fueled by the ongoing Israel-Iran conflict.
• Fears of a broader military escalation in the Middle East intensified after Iran and Israel exchanged a new round of airstrikes, further destabilizing the already volatile region.
• Market sentiment deteriorated further after U.S. President Donald Trump refused to clarify whether the United States would intervene, saying only, “I may do it. I may not do it.”
•The uncertainty surrounding potential U.S. involvement in the conflict has heightened risk aversion, fueling strong demand for traditional safe-haven assets like the dollar and pressuring risk-sensitive currencies like the rand.
• At GMT 15:34, the dollar was trading up 0.70% at 18.123 against South African rand.
• Technical signals are strongly bullish as RSI is at 57, daily momentum studies 5,9 and 11 DMAs are trending up.
• Immediate resistance is located at 18.131(38.2%fib), any close above will push the pair towards 18.191(Higher BB).
• Strong support is seen at 17.678(23.6%fib) and break below could take the pair towards 17.530(Lower BB)
Recommendation: Good to buy around 18.100 with stop loss of 17.800 and target price of 18.500
