South Africa 40 Cash Index conforms to rangebound price environment
Recent price reversals confirm 65570 (support) and 67940 (resistance) as the relevant trading range
South Africa 40 Cash Index
While having reached our initial downside support target of 655570, the South Africa 40 Cash Index has failed to extend losses and test the next target of 655040.
Circled red we have a bullish price reversal off the 65570 level. The price has since started to move back towards range resistance at 67940.
Recent price reversals confirm 65570 (support) and 67940 (resistance) as the relevant trading range for the index at present.
When a rangebound price environment is prevalent, as is the case on the South Africa 40 Cash Index right now, our preference is to look to trade between the levels of the range or wait for a breakout of the range.
New short positions might be considered on a bearish price reversal around either the 67940 or 68515 resistance levels.
New long positions might be preferred should a bearish price reversal not confirm, and instead we see a bullish break of the 68515-resistance level.
Should one of these trading scenarios present themselves we will update guidance with targets and failure levels.
Key data this week
Date |
Time |
Region |
Event |
Previous |
27 March 2024 |
3:00pm |
ZAR |
SARB Interest Rate Decision |
8.25% |
28 March 2024 |
2:30pm |
USD |
Final GDP q/q |
3.2% |
28 March 2024 |
2:30pm |
USD |
Unemployment Claims |
210K |
28 March 2024 |
4:00pm |
USD |
Pending Home Sales m/m |
- 4.9% |
28 March 2024 |
4:00pm |
USD |
Revised UoM Consumer Sentiment |
76.5 |
29 March 2024 |
2:30pm |
USD |
Core PCE Price Index m/m |
0.4% |
29 March 2024 |
5:30pm |
USD |
Fed Chair Powell Speaks |
|
South Africa 40 Cash Index (previous)
The bearish price reversal (circled black) off the 67940-resistance level, and downside break (close) of the 66900-support level, highlighted in our previous note (18 March), has resulted in a relatively quick move towards the 65570-support target.
Traders who are short might now consider trailing their respective stops from the 67270 level to the current intraday high at 66250.
The price has not yet moved into oversold territory, suggesting that 65040 as a revised downside support target.
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