J253
JSE's Property Sector forming a bottom? $JSE $PROPThe JSE's listed Property Index (J253) is looking for a bottom here with the formation of an inverted head & shoulders bottoming pattern. After failing and breaking through it's medium term horizontal support level at 450 pts, the index has more than halved. However, as things stand, (and analysed together with the H&S on the SA GOV 10 year bond yield which is breaking down from H&S top) i believe the sector is ready to put in a bit of a rally from current levels. A break above the neckline of the inverted H&S formation @ 236 pts could see the property index run up to a target of 280 pts (+- 19% rally) which is also where we find the daily 20 day moving average. In Addition, the RSI has broken its DT line, which gives me further clarity that the worst of the bearish momentum could be behind us. The Rand bears have also not managed to make any progress above the 18.0 level to the USD and this is starting to give us a clue that the downgrade to junk could just as well have been priced in. Putting everything together, i would take my chances and expect to see a bit of an oversold rally transpire on the JSE's beaten down property sector.
