FxWirePro: USD/ZAR dips as South African rand benefits from renewed risk appetite

• USD/ZAR fell on Wednesday as the South African rand strengthened as investors turned to riskier assets after Fed Chair Jerome Powell signaled the possibility of further U.S. rate cuts.

• Fed Chair Jerome Powell, in a speech on Tuesday, left the door open to rate cuts, noting that the U.S. labor market remains stuck in a period of subdued hiring and limited layoffs.

• He noted that despite the government shutdown halting official economic data, policymakers can still assess the economic outlook for the time being.

•Like other risk-sensitive currencies, the rand typically responds to global factors such as U.S. economic data and policy decisions.

• Immediate resistance is located at 17.370 (38.2%fib), any close above will push the pair towards 17.485 (Higher BB).

• Strong support is seen at 17.283 (SMA 20) and break below could take the pair towards 17.079 (23.6%fib).

Recommendation: Good to buy around 17.400 with stop loss of 17.600 and target price of 17.200