Pre-Market
JSE Top 40 Index. The Top 40 is acting in line with my view on 22 August 2024, where I highlighted the index entering an overbought range. On the day, the index traded higher but closed much weaker, suggesting at the time that seller had started to take control following a strong run, with aggressive buying pressure. Over the subsequent 12 trading sessions, the index has unwound by 3300 points and in the process, breaching the 8, 21 and 50-day exponential moving averages. The candle structure reflects strong selling pressure which means that the next key moving averages could be vulnerable to being breached. Which levels should traders monitor going forward? The 21-week EMA is close to the swing lows and should the price reach this level, it could coincide with short term oversold conditions. Failing this, the short term support at 72200 is a 'next support zone'. For bullish reversal opportunities traders should look for evidence of buying on the 15, 30-min and 1H charts to suggest that buyers have started to step up again.
Previous Post (22 August)
PRE-MARKET
Lester Davids
Analyst: Unum Capital
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