• USD/ZAR dipped on Thursday as South African rand strengthened against a softer dollar as investors digested a U.S. inflation reading that largely met expectations.
• The greenback slipped about 0.3% against a basket of currencies after the release of the U.S. personal consumption expenditures price index, which eased some concerns about imminent Federal Reserve rate hikes..
• Data on Thursday showed that South Africa's producer inflation quickened to 7.8% year-on-year in May from 4.8% in April, exceeding Reuters economists' expectations of 6.7%.
• Like other risk-sensitive currencies, the rand often takes cues from global drivers, in addition to domestic economic data..
• Immediate resistance is located at 16.556(50%fib), any close above will push the pair towards 16.695(Higher BB).
• Strong support is seen at 16.367(SMA20) and break below could take the pair towards 16.2720(61.8%fib)
Recommendation: Good to buy around 16.350 with stop loss of 16.200 and target price of 16.700
