Our bullishness last week was clearly not the right call. Volatility has crept into the market and there is a lot of uncertainty around what happens next. Therefore, in order to clear our own minds of bias, we will be looking at markets from purely a technical perspective this week.
Offshore trade ideas
S&P 500 (SPY)
We’ve seen the large rising wedge formation give a bearish break. Now price has moved below the 89 day moving average, which is a key medium-term trend indicator in our book. It is interesting to see that on Friday the market tested the 89 day moving average from the bottom, but failed to break above it. This rejection of a key trend indicator opens the 200 day moving average as a potential downside target.
Dow Jones Transportation Average (DTX)
DTX has lost the 200 day moving average support. This is a longer-term trend indicator in our book and it being broken is worrying for the bulls. The immediate downtrend line (white) could act as a potential buy signal, but until that happens, the trend is down.
Brent Crude Oil
Maybe our bias is too strong, or maybe the chart is just bullish… either way, Oil is looking good for a push higher.
Xtrackers Physical Rhodium ETC Fund (XRHO)
It’s getting close now. A break above the white trend line here would make a good buying opportunity in our view. Should XHRO break higher, it could be a catalyst for local PGM stocks to get moving as well.
Platinum Futures (PL1!)
Platinum might also be on the verge of finally breaking its recent down trend.
USDZAR
Very short-term view here, but the breaking of the yellow trend line could see the USDZAR strengthen to about R14.50.
Bitcoin (BTC)
The usual weekly logarithmic chart for crypto’s. Fairly bullish looking setup. Perhaps it’s finally time for the fourth quarter pump?
Ethereum (ETH)
Two nice looking candles for the bulls on ETH.
American Tower (AMT)
AMT has had a sharp selloff in recent weeks. The last time we saw such a fast and furious selloff it turned out to be a great buying opportunity. Early signs of shifting momentum supports the long trade idea here.
Peabody Energy (BTU)
I don’t know if you guys have seen coal prices in China… or that coal power plants around the world are shutting down due to a shortage of coal…? BTU mines coal. A whole lot of coal. Very decent long setup here as well. Me..? I like the stock.
VanEck Oil Services ETF (OIH)
It looks like the trend line break is playing out. You could probably see an inverse head and shoulders formation there as well if you squint hard enough. We’re looking for $240 as a target price.
South African trade ideas
JSE Top 40 (ALSI)
Looks like the ALSI bounced to retest the 57700 level and is set up to trade lower once more. Downside target is 53000.
Clicks Group (CLS)
CLS looks rather interesting. A reversal around R265 could provide a very high risk-reward long opportunity.
Impala Platinum (IMP)
Momentum wise it looks like IMP might be setting up for a bounce. If we see the two PGMs mentioned in the offshore trade ideas section above break higher, IMP could be a really good long from around these levels.
Mediclinic International (MEI)
MEI back to the bottom of the range?
Sanlam (SLM)
Looks like SLM is going to try break out of this range again. You can use a three day low as your trailing stop loss if you take this long trade.
Sibanye-Stillwater (SSW)
Very high risk-reward setup on SSW here. Once again dependent on PGMs in general, although the risk-reward is so great here it might just be worth taking a stab.
We’re talking to Ghosts!
We will be having a series of chats with The Finance Ghost and Mohammad Nalla during the month of September. Our goal is to educate the listeners and to let people out there know about what we do, and how we do it.
Jonathan talks about Day Trading, what it takes and what his journey was. This was a very insightful chat and is highly recommended for anyone who is actively trading, or thinking about becoming very actively involved in markets.
Do you day to day trade?@MohammedNalla and I welcomed Jonathan from @HerenyaCapital onto Magic Markets to find out what really goes into that process.
— The Finance Ghost (@FinanceGhost) October 3, 2021
This is the final show in the #HerenyaSeptember series with @TraderPetri and team. It's been epic!https://t.co/QRXT97y6rV
Want ideas, insights and research?
*Please note that these trade ideas form part of a larger weekly plan and the value of financial products can increase as well as decrease over time, depending on the value of the underlying securities and market conditions. The risk of loss arising from trading in Contracts for Difference can be substantial. You should carefully consider whether such investments are suitable for you in the light of your circumstances and financial resources.