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FxWirePro: USD/ZAR eases ahead of South Africa inflation data and SARB decision

• USD/ZAR eased on Monday as markets looked ahead to inflation figures and the central bank’s policy decision this week for clues on the future path of interest rates in South Africa.

• Market participants are focused on Wednesday’s release of August consumer inflation figures and the South African Reserve Bank’s interest-rate decision..

• South Africa’s headline inflation slowed to 4.3% year-on-year in July, its first drop in five months.

• The central bank is widely expected to raise its main lending rate on Wednesday after unexpectedly holding it at its previous meeting, saying monetary policy was sufficiently restrictive to bring inflation back to target within two years.

• Immediate resistance is located at 16.367(Higher BB), any close above will push the pair towards 16.525(50%fib).

• Strong support is seen at 16.209(38.2%fib) and break below could take the pair towards 16.110(SMA 20).

Recommendation: Good to sell  around 16.300 with stop loss of 16.400 and target price of 16.100

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