South Africa 40 Cash Index price breakout ahead of key data
The South Africa 40 Cash Index has produced an upside breakout, the success of which could be determined by international news flow.
The South Africa 40 Cash Index has now produced a short-term range breakout. This is noted by the price close above the 72370-resistance level. The move higher follows global markets higher, after slightly better than expected US inflation data and its suggestion of perhaps a less hawkish Federal Reserve to follow.
The long-term trend remains up as we see the price still trading firmly above the 200-day simple moving average (blue line) (200MA).
The short-term breakout suggests that the near-term trend is realigning with the longer-term uptrend. 73420 provides the initial upside resistance target from the move, while a close below the dotted black trend line on the chart above might be used as a trailing stop consideration.
The current technical setup is however deemed to be high risk in the context of upcoming high impact macro data which has the propensity to induce short term volatility.
Key data to watch
Among the key upcoming data points (central bank meetings), which could provide a major influence on global markets, sentiment and in turn our local bourse are as follows:
8pm Wednesday 14 June, Federal Funds Rate decision and policy statement
2:15pm Thursday 15 June, European Central Bank (ECB) rates decision and policy statement
Early morning Friday 16 June, Bank of Japan monetary policy statement and press conference
IG client sentiment
As of the 14th of June 2023, most IG clients (73%) with open positions on the South Africa 40 Cash Index expect the price to fall in the near term, while 27% of IG clients with open positions expect the price to fall.
Top movers on the JSE this week so far
Top movers for the trading week helping drive gains in the index include MTN, Mr Price, Woolworths, Sanlam and FirstRand.
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