XJSE_TOP40_CFD trade ideas
Top40 index: mean reversion trade?A price action above 54700 supports a bullish trend direction.
RSI leaves enough room for upside price potential.
Price action in oversold territory.
At its lower range of the linear regression channel pattern - which increases the likelihood of a mean reversion trade.
Also at the lower range of the Bollinger Bands.
Might the 200-day be on the horizon as a target?
JSE TOP 40 Picture Looking ScaryAfter an almost 10% drop in just over a month in this index, I see some people already looking for entry points to go long again, as in long term. There are several technical aspects of great concern to me, pointing to something completely different. Here is a few.
• The red lines indicate that the price has now been in a bearish divergence with several indicators over a long time.
• The yellow lines show a previous downward move in indicators, but mostly a sideways movement by the price over the same period.
• My question: What are the chances of getting another sideways price movement in short succession? I have my doubts about that one.
• Most important for me to be aware of is the fact that the MACD has now turned downwards. It is a substantial distance from the zero line, and on monthly charts one does not see a change in direction of the MACD every month or two.
All in all, not a good outlook in my view, but that ties in with most indices worldwide.
ALSI/j200/TOP40 daily chart bull flag breakoutALSI/J200 held support into the 59000 mark with positive RSI divergence 2 weeks ago,
Right now we it is trading at the upper end of this year long consolidation with a Bull flag breakup happening today
A close above 63000 today confirms the breakout.
Reward to risk 2.5 : 1