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South Africa Top 40 Index

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JSE:J200 Top40 Automatic RallyAfter the distribution and markdown (discussed in previous posts), we have had a selling climax (SC). This is noted by the high volume and capitulation of the market. Now we are seeing an automatic rally (AR) from the SC lows. This should back up (BU) to the previous distribution trading range. Once this is done we could see a trading range form (fluctuating within the bounds of the SC and AR) which we then can evaluate to determine if it is a redistribution or accumulation trading range. A number of stocks are rallying and we will watch for the retest to go short to test the SC lows.
JSE:J200Long
by SteynTrade
JSE:J200 Top40 Wyckoff Distribution and MarkdownInstitutional investors which include foreign investors have bee distributing the JSE stocks since 2015 (see posts below for further analysis). Following a Wyckoff approach to the markets an upsloping distribution range was formed and now the markdown has started. Price has broken the upsloping stride and the lows of the automatic reaction (AR) at the start of the trading range with the largest two down bars ever. We may have a rally back to the breakout levels but I am expecting further markdown to take place.
JSE:J200Short
by SteynTrade
JSE:J200 Top 40 Change in CharacterThis week has seen the largest down bar. Volatility to the downside has been increasing since 2015 and the clear change in character (CoC) last week could indicate a lot more downside to come. We have been following what has been looking like distribution for some time and this move could be the markdown in phase D. After a possible pause at the bottom of the trading range we could be in for a larger markdown below the trading range in phase E.
JSE:J200Short
by SteynTrade
69% Chance of a Santa Claus Rally on the JSE in 2019Go to Google, Bloomberg, Business Times and you’ll see big debates between nations talking about this rally. This sparked my curiosity to see if we could also see a stock market rally on the JSE this year. Today I’m going to tell you what the Santa Claus rally is, why it exists and how you have a 69% chance to profit from the JSE this December. Let’s get to it… Why you can see a sudden stock market rally at Christmas time The Santa Claus rally, in a nutshell, is when stocks see sudden price rises and strong gains near the end of December and in early January. And when stocks rally, this drives up the actual stock market indices as well. According to the 2019 Stock Trader’s Almanac, there’s an average 1.3% market rally in stocks, during this time that has taken place 75% of the time since 1969. We are not 100% sure why the stock market ends positive during the last few days of the year, but here are some common theories. Theory #1: Investment managers cut down on their taxes This is the time when you’ll see investors and investment managers, selling their stocks to lock in tax reductions before the end of the year. Once they sell their positions, they then buy other stocks and markets that they believe will rally in the next year. The buying of these stocks, leads to a rise in stock prices which pushes the stock market indices up. Theory #2: Investors treat themselves with their bonuses Investors tend to splurge at the end of the year on stocks with their bonuses they’re paid at the end of the year. And when there’s buying, demand picks up which leads to higher stock market prices. We can speculate all we want, but nothing tells us the truth more than what the charts show. What you see, is the monthly JSE-ALSI stock market chart since 2003… Looking at the chart you can see how each December (Vertical blue line) performed from 2003 up ‘till 2018. Year Gain/Loss 2003 7.39% 2004 1.28% 2005 6.84% 2006 3.90% 2007 -4.99% 2008 0.51% 2009 2.62% 2010 6.69% 2011 -3.26% 2012 2.72% 2013 3.27% 2014 -0.53% 2015 -1.15% 2016 0.48% 2017 -1.33% 2018 4.63% So, there’ve been 11 out of 16 Decembers (69%) that have shown positive gains. And in total, the JSE has accumulated 29.07% gains in all of those Decembers. This means, you have a higher chance of profiting from buying this Christmas than selling. Trade well, Timon Rossolimos Founder, TimonAndMATI.com
JSE:J200Long
by Timonrosso