The market has become very strange indeed. The trend is so strong and there are so many dip buyers around that it seems the part will never stop. Although, whenever there are a few down days, the mood turns really dark and a semi-panic seems to take over. This is one more thing that worries us when thinking with the longer-term hat on. Why are traders to extremely negative when the market ticks down only a few percent? How much is the average trader geared and long the market? What happens when the market pulls back 10%? What happens when the Fed actually hikes interest rates? And what happens if the Fed hikes rates and starts tapering at the same time? These are some of the questions that we are pondering. But for now, the show goes on and the bulls keep dancing. Buckle up, because we’re headed for new highs.
Offshore trade ideas
Dow Jones Transportation Index (DTX)
A nice clean break here on the DTX. This was the overall buy signal for U.S. equities. From here, it looks like we are headed for new highs.
S&P 500 (SPY)
The early warning served the market well. As is the case with most U.S. equity indices right now, it looks like we are firmly headed for new highs in the coming weeks.
Bitcoin (BTC)
Talking about headed for new highs… BTC is looking stronger than that awkward feeling of discomfort and weirdness when you’re stuck in traffic behind some guys sitting on the back of a bakkie.
Ethereum (ETH)
ETH is also looking very strong. Our thesis of a parabolic move in the last quarter of this year still has hope.
U.S. Dollar Index (DXY)
Back to reality a bit and it looks like the DXY has gotten stuck in a small range. It is a bit hard to read now, but it does seem logical that the DXY should come and test the $93.50 to $93.00 level before continuing to trend higher. There might be a few choppy weeks ahead with short-term USD weakness as it tests the break out. Overall though, we think that this is the start of a new “stronger dollar” trend and that a retest of $93.00 could be a decent chance to move some ZARs offshore.
USDZAR
Our stronger ZAR call two weeks ago had a choppy start, but worked out in the end (8 cents to go). Given our thinking above, we imagine that the USDZAR trades down to around R14.15 to retest what is a fairly significant level.
Brent Crude Oil
It’s so close you can taste it! Starting to wonder it the time for a pullback is not starting to get close now. For now though, sit patiently and start pondering where and how a trailing stop loss can best protect gains made here.
American Tower (AMT)
We highlighted AMT as a potential buy two weeks ago and once again bring it to your attention. Above $270, and this stock is headed for new highs.
South African trade ideas
JSE Top 40 Index (ALSI)
Once again we are just posting the ALSI chart to say that we don’t really have a clear setup on this market and thus will be staying out of the way.
Aspen Pharmacare (APN)
APN overshot out initial long target by a country mile. Since then it has pulled back into the original target zone. Interestingly this seems to now be a zone in which some accumulation is taking place. It could make an interesting long with a clear stop loss from here. Worth keeping an eye on.
Clicks Group (CLS)
The retailers in general are definitely worth keeping an eye on over the next week. If the ZAR eats its jungle oats, retailers could fly. So far CLS has the most clear setup to watch. It’s a little less liquid and thus a little more wild, so trade with caution.
Woolworths (WHL)
There is no actual buy signal on WHL just yet, but retailers could be the play for next week, so it is definitely worth having WHL on your radar.
Capitec (CPI)
Patience will be rewarded. The seller stopped the breakout in its tracks at R1906, although this has created a good long setup. There is big divergence and a solid trend in place. CPI could be headed for new highs.
Sibanye-Stillwater (SSW)
SSW has had a great run from the R45.00 – R46.00 level. It has now put in two fairly bearish looking daily candles, right in and below a previous support zone. Maybe it’s time for the shorter-term traders to bank some profits here?
Jubilee Metals Group (JBL)
JBL is exactly the opposite of SSW, which rings an alarm bell somewhere in the back of this analysts head… Nonetheless, this is a clear break in a strong up trend. So this too looks like it is headed for new highs.
Mondi (MNP)
We havent pulled the trigger on the long trade here yet, but MNP is looking juicier and juicier.
Joining HCA trading
HCA trading offers a number of different trading accounts to suit different types of traders. Our offshore trading accounts allow traders to buy shares, ETFs, CFDs and even fractional shares in the United States for only $2 a trade. Locally, we offer shares, ETFs and CFDs at good rates with robust and reliable trading platforms. All our trading, including CFDs, is done on a Direct Market Access basis and thus our clients are able to interact directly with the real equity market and not have to worry about excessive counterparty or liquidity risk. Our prime broker locally is a big four bank and offshore we make use of one of the largest non-bank prime brokers in the world.
Local stockbroking rates
| Trading instrument | Brokerage rate | Margin rate | Minimum trade charge |
| JSE listed equities and ETFs | 0.30% | 100% | R150 |
| CFDs on JSE listed equities | 0.20% | 10% – 25% | R50 |
| SAFEX listed index futures (ALSI) | R20 | 6% – 8% | R20 per contract |
Offshore stockbroking rates
| Trading instrument | Brokerage rate | Margin rate | Minimum trade charge |
| U.S. listed equities and ETFs | USD 1 cents per share | 100% | USD 2 |
| Canada listed equities and ETFs | CAD 2 cents per share | 100% | CAD 2 |
| U.K. listed equities and ETFs | GBP 12 + 0.1% | 100% | GBP 12 |
| Germany listed equities and ETFs | 0.20% | 100% | EUR 8 |
| Forex | 0.40% | 100% | USD 4 |
*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.