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Jse_top40

$SA40 JSE TOP40 index - is it time for a retracement?The top40 index bumped into weekly downtrend resistance @ 52200 connecting multiple tops since 2017. Given the one-sided rally off the march lows, the probability favors a bit of a pause and retracement before an attempt to break out through the oncoming resistance. I would be quite surprised to see the index break out to new highs without some sort of pause/consolidation in price. Should we begin to retrace off 52200, levels we could target are likely 48000 and 46000.
TVC:SA40Short
by MarcoOlevano
South Africa TOP40 gearing for outperformance against the SP500?Known to all, the US markets have outperformed the SA markets for a significant period of time. From a pure charting perspective, the series of higher lows on the macd indicator vs the series of lower lows on the price chart of the pair (SA40 vs.SPX) is indicative of bullish divergence warning of a change in trend where we could start to see the SA40 Index outperform against their US counterpart. Fundamentally feels impossible with all the bad news locally, but it could purely be a case of the rand weakness against the dollar which drives your "rand-hedge" counters such as Naspers, BTI, CFR and the resources which are a significant weightings of our index. This is a weekly chart so it could take some time to play out, but it will be interesting to monitor this going forward.
TVC:SA40Long
by MarcoOlevano
2
$JSE Top40 facing massive overhead supplyThe current levels between 47600-48000 on the JSE's TOP40 index was a major area of support in the second half of 2019 before breaking down to low at a level of 33400. If a change of polarity where to take place at current levels you would expect this previous area of support to be respected by the market and possibly turn into resistance. I was quite shocked to realize the percentage gains from the lows, as you would have basically made a return of 43% if you miraculously managed to pick this exact bottom on March 19 and hold it to current levels. One would do well not to be overexposed on the long side of the market, as the odds of a correction from these levels are pretty good. Watch for a reversal candle to form which could indicate a short term top in the market. (i.e todays candle to close towards lower end of the candle range)
TVC:SA40Short
by MarcoOlevano
Medium probability - Reversal Symmetrical Triangle on ALSI 40Here’s why I expect the JSE to plunge 10%... Reason #1: When world markets crash, South Africa goes down with it As global markets plunge, history has shown us the JSE will follow suit! Last week alone, global stock markets closed down over 2% in one day because of the coronavirus: London's FTSE: -2.5% European Stoxx: -2% France’s CAC: -2% Germany's DAX: -2.5% Shanghai Composite: -2.7% Japan's NIKKEI: -2.2% The JSE : -2.7%, And with the rate that the virus is spreading on a daily basis, the world markets will continue to drop as investors flee away from stocks due to the uncertainty and fear the virus can bring to the companies. Unfortunately, we’ll need to wait it out until we see the number of cases (from the virus) start to slow down – before we see a market rally again. Reason #2: Drop in Chinese visits As the global outbreak has spread to over 13 countries, including the US, there are serious measures being implemented to try to contain the virus. And as the virus continues to spread, South Africa will eventually feel the impact. In fact, Efficient Group Chief economist Dawie Roodt explained that South Africa will be affected in three ways… “The first is through the real economy if other countries start closing borders, affecting trade and tourism. The second is through the financial markets and its impact on commodity prices and exchange rates. The third is if the virus also arrives in South Africa,” With less international travel, with fewer businessmen and tourists arriving in South Africa, this will cause a disruption to the economy. This is because Chinese tourism has become a major source of foreign exchange income for South Africa. Finally… - my charts confirm it! Reason #3: The charts point to double-digit losses on the JSE Looking at the daily chart of the JSE, it’s been forming in a negative triangle formation for the last two years. Based on the global reasons above, I now expect the price to break below the bottom of the triangle. Once this happens, selling pressure and panic will kick in and cause the price to drop to the bottom of the triangle. In this case my first target to hit is down 10.9%.... This is a medium probabiility trade as knowing the change of market sentiment, anything can happen... UNtil it hits the stop loss, my outlook is bearish...
JShort
by Timonrosso