• USD/ZAR firmed on Tuesday as a firm U.S. dollar outweighed data showing an expansion in economic activity signalled by the central bank's leading business cycle indicator..
• The dollar firmed as investors grew sceptical of a swift end to the Middle East conflict, partially reversing the optimism-driven moves seen in the previous session.
• South Africa's composite leading business cycle indicator rose 0.4% month-on-month in January, central bank data showed on Tuesday.
• Investors now turn to Thursday's central bank rate decision, when economists polled by Reuters expect the bank to keep its main lending rate steady at 6.75%.
• Immediate resistance is located at 17.177(50%fib), any close above will push the pair towards 17.418(Higher BB).
• Strong support is seen at 16.801(38.2%fib) and break below could take the pair towards 16.520(SMA 20)
Recommendation: Good to buy around 16.900 with stop loss of 16.600 and target price of 17.200
