• USD/ZAR rose higher on Wednesday as greenback rallied on expectations the Federal Reserve will raise interest rates further,
• The dollar extended its gains after S&P Global reported that its flash U.S. Composite PMI Output Index rose to 58.4 this month, its highest level since July 2021, from 56.0 in August..
• Expectations for at least a 25-basis-point Fed rate hike in October jumped to about 75% after the data, from roughly 53% beforehand.
• South African inflation edged higher in August, with headline inflation rising to 4.4% year-on-year from 4.3% in July, but remaining below the 4.5% average forecast in poll of economists.
•Like other risk-sensitive currencies, the rand often takes cues from global drivers like U.S. economic indicators, in addition to domestic economic data.
• Immediate resistance is located at 16.461(Higher BB), any close above will push the pair towards 16.675(38.2%fib).
• Strong support is seen at 16.285(50%fib) and break below could take the pair towards 16.155(SMA 20).
Recommendation: Good to buy around 16.300 with stop loss of 16.100 and target price of 16.500
