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FxWirePro: USD/ZAR edges higher but outlook is bearish

• USD/ZAR edged higher on Thursday as global investors remained cautious and avoided large positions while assessing a surprise U.S. Treasury announcement aimed at supporting the bond market..

• The U.S. dollar weakened against a basket of currencies after the U.S. Treasury announced plans to double buyback operations for longer-dated government bonds to bolster market liquidity.

• The announcement followed a sharp bond selloff as investors sought higher returns amid rising inflation risks linked to the U.S.-Israeli war with Iran.

• Like other risk-sensitive currencies, the rand often follows global market developments when the domestic economic calendar is light.

• Immediate resistance is located at 16.274 (Daily high) any close above will push the pair towards 16.366(SMA20).

• Strong support is seen at 16.051(23.6%fib) and break below could take the pair towards 15.921(Lower BB).

Recommendation: Good to sell around 16.150 with stop loss of 16.250 and target price of 15.900

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