The following is a partial recap of the market analysis shared during today’s morning Discord call.

Today’s opening market is very red, with weakness in the South African market and the commodity sector, while the dollar and U.S. bonds maintain their strength. This is in large part due to concerns of an impending interest rate hike, which remain prevalent, especially as Kevin Warsh and other authorities continue to signal a desire to maintain the dollar’s strength. The U.S. market, in the meantime, is moving sideways, as the semiconductors and, to a lesser extent, software see most of the growth, which, in conjunction with yesterday’s volumes, gives us the impression that we’ll have a quiet session today.

Local Stocks

Thungela Resources (TGA)

Thungela has been trading below pre-war levels and has been dropping, and the market’s reaction to yesterday’s quarterly update has dashed any hopes of a return to the R100 mark in the immediate future. With the earnings coming up in August, we speculate that Thungela will have to play with Dividends to gain the market’s interest. For now, we recommend adding it to your wait-and-see list in case it consolidates at some point.

Equites Property Fund (EQU)

Equites was upgraded to buy by Investec, with a new target price of R19.4, which is a 9% increase from its closing price at around R17.6.

Ex-Dividends & Economic Data

We’d like to remind you once again that the Hong Kong and Canadian markets are closed today due to a public holiday, and subsequently, certain stocks like Tencent (700) will not be available or move.

Ex-Dividends

The following stocks are set to go Ex-div today.

Economic Data

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*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.

The post The Daily Trades 01/07/2026 appeared first on Herenya Capital Advisors.

Bigger picture (offshore trade ideas)

S&P 500 (SPY)

This rally feels a little long in the tooth, but it’s not for us to decide when it ends. A trailing stop loss is advised for those with long positions. For those looking to short, perhaps around $461 could offer a decent risk-reward, although for now we don’t think standing in front of the bus is a good idea. You could put up a tertiary trendline on the move from around June and use that as a potential short entry (or stop loss if you are long). Either way, dance close to the door.

Philidelphia Semiconductor Index (SOX)

SOX is still spending time hugging the upper end of the channel. We’d like to see it test the lower band, but it seems that we will need to be patient. You could probably put a mid-channel line in and use that as a trigger for any new trades here (aka. the short trade to the lower end of the channel). Just note that trading against the trend could be bad for your health.

Nasdaq (QQQ)

See our comments on SPY. ‘Don’t fight the trend’ is probably the only thing we can say here. Well, we will say that we think this has gone too far, but we’ve tried that a few times and have not been right yet (at least not recently). So, we will be patient and wait for the market to lead the way.

Brent Crude Oil

Oil is looking good to hold the $78.85 level and make a push for $87.35.

Gold

Gold pulled back a little in the second half of the week, but overall the move toward the recent highs still seems to be in play. We would be buyers on weakness here, at least for the next few weeks.

U.S. Dollar Index (DXY)

DXY bounced off $99.50 and smacked right into $101. It’s too early to really be able to tell, but we think that we might see the Dollar get really strong again in the near future (aka. get and hold above $101 and head for $103). Will it test the highs around $114 again..? Maybe. It won’t happen fast if it does, but it is possible in a scenario where global economic conditions continue to deteriorate and investors are looking for safety. We also have to be mindful that we could see the U.S. stop with the hikes, which will attract capital into longer-term U.S. Government Bonds, which not only could be a good trade in itself, but also drive much strength for the Dollar.

EURUSD

Forex traders… are we seeing a good short here? Let us know what you think by tweeting us.

USDZAR

The USDZAR is forming a bit of a base here by the looks of it. We think we see some Rand weakness in the week to come.

Top Securities Broker Awards

Once again Herenya Capital Advisors is competing in the Intellidex Top Securities Brokers Awards. 

Launched in 2010, the Top Securities Brokers survey (formerly Top Stockbrokers) is the Industry’s premier independent assessment of the industry. 

The survey is based on a comprehensive survey of securities brokers as well as their clients, with high emphasis placed on client rankings of their firms across an extensive list of categories. 

The online survey to find the top securities brokers in SA is now open, and we would greatly appreciate you taking the time to complete the 2023 online client survey and share your experiences. 

To rank Herenya Capital Advisors click here. 

The survey will take approximately 20 minutes to complete.

All participants are automatically entered into a lucky draw and stand a chance to Win R10,000, offered by Intellidex. 

In the past year Herenya Capital has grown from strength to strength, not only have we been featured on some of the most revered platforms, but we have also been commended by our peers and our clients for our excellent service and tenacity to stay at the forefront of the finance industry. We also won the title of Best Stockbroker for Traditional Investors in South Africa. We would greatly your appreciate your support to help us take another title of two this year.

Please let us know if you have any queries or require additional information.

South African trade ideas

JSE Top 40 Index (ALSI)

You can see what our thinking is by looking at the chart. The last two weeks have been, well, not in line with our thinking. So, we stay open to the idea that is might just keep pushing higher, but we really still don’t have any reason to believe that the market is bound to go higher. In other words, we remain bearish.

Sasol (SOL)

Oil price looking bullish, Rand looking weaker… spells good times for SOL if you ask us. As long as this base holds (green line), then we should be good to stay long.

Tiger Brands (TBS)

This little bear flag setup on TBS looking like it is starting to get going now. R135 calling?

Anglo American (AGL)

It’s beginning to work! There is a lot of upside in this trade in our view, so be patient and give it the space and time it needs.

Aspen Pharmacare (APN)

APN closed at the highs on Friday, breaking the overhead resistance (not drawn, but visible in the form of that thin dotted blue line) and opening for the next leg higher. R200 then R210 as short-term upside targets. R230 and R240 as medium-term upside targets.

City Lodge Hotels (CLH)

The CLH trade is working very well. We do think that there is more upside to be had here over the coming months, but perhaps taking some (a third, or even half) of the money off the table is not entirely a bad idea.

Join a winning team

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

Offshore stockbroking rates

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If you enjoy reading our blog and would like to get email updates each time we post, please subscribe below.

*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.

The post Staying flexible appeared first on Herenya Capital Advisors.

Bigger picture (offshore trade ideas)

S&P 500 (SPY)

The double top we looked at last week has failed and the market went on to push higher. It seems now that SPY wants to trade to that $461 level. We are going to be patient in the sense that we are not going to chace the long trades here, nor are we going to continuously attempt to short. We will wait for another clear setup before we trade again.

Nasdaq (QQQ)

The QQQ chart looked a little better to us last week than the SPY chart did. As mentioned last week, it made a double top right on the resistance level. Well, thank goodness for stop losses because on Wednesday the resistance was blasted through and QQQ kept printing highs. We can debate the candle that formed on Friday (shooting star?), but as is the case above, we’re going to sit back and wait for a new setup before making any moves.

Philadelphia Semiconductor Index (SOX)

SOX still bumbling along the top end of the channel. We’re still of the view that we will see SOX test the lower end of the range, and with bearish engulfing candle printing on Friday, the short trade is looking mighty tempting here. This might be one that we actually take the short on when U.S. markets open on Monday.

U.S. Dollar Index (DXY)

DXY tagged the $99.50 level. Where to from here? We think we see the bounce to $101.30 before eventually breaking below $99.50 (and trending lower).

Brent Crude Oil

Oil finally made it above the midpoint of the range it has been trading in for some time. Let’s see what it does from here. We would like to see it trade all the way to $87.35, but we’re not sure that it will be able to do that immediately. It does look a little overbought here. Patience is needed here. Technically this is now in the middle of the range, so there is really no setup to be traded here.

Gold

Alrighty, gold broke the short-term downtrend and so far seems to be going for a move back to the highs. On the back of this chart (and move in gold price), we like gold stocks for longs in general here.

Platinum

Platinum has also put in the bounce we were looking for. Let’s see if it has enough legs to get back to the highs.

USDZAR

Ok, so maybe some bears get honey. The bear flag on the USDZAR has worked beautifully. We looked at this chart two weeks ago, then thought we were wrong and last week expressed our confusion. Seems all we needed was some patience as the ZAR went on a rampage last week. From here…? We wait for a new setup. We’ll likely see R17.60 soon, but let’s wait for it to consolidate there and give us some idea of what it wants to do next before we take any new trades.

Top Securities Broker Awards

Once again Herenya Capital Advisors is competing in the Intellidex Top Securities Brokers Awards. 

Launched in 2010, the Top Securities Brokers survey (formerly Top Stockbrokers) is the Industry’s premier independent assessment of the industry. 

The survey is based on a comprehensive survey of securities brokers as well as their clients, with high emphasis placed on client rankings of their firms across an extensive list of categories. 

The online survey to find the top securities brokers in SA is now open, and we would greatly appreciate you taking the time to complete the 2023 online client survey and share your experiences. 

To rank Herenya Capital Advisors click here. 

The survey will take approximately 20 minutes to complete.

All participants are automatically entered into a lucky draw and stand a chance to Win R10,000, offered by Intellidex. 

In the past year Herenya Capital has grown from strength to strength, not only have we been featured on some of the most revered platforms, but we have also been commended by our peers and our clients for our excellent service and tenacity to stay at the forefront of the finance industry. We also won the title of Best Stockbroker for Traditional Investors in South Africa. We would greatly your appreciate your support to help us take another title of two this year.

Please let us know if you have any queries or require additional information.

South African trade ideas

JSE Top 40 index (ALSI)

Oh how wrong we were last week on the ALSI. The super strong Rand lifted most of the market (although in very thin volume), while the pumping gold price pushed the gold stocks. This was the perfect storm for the ALSI longs. Well done to the bulls. We concede and we wait for another setup.

AngloGold Ashanti (ANG)

ANG bouncing off the trendline like a champion! We hope you got a decent long entry here. Keep a trailing stop loss and have some patience. We think we might have a proper winner here.

Capitec (CPI)

Banks have been strong and if the Rand keeps it up, banks will likely stay strong. CPI is headed for some resistance though in the form of a medium-term downtrend line. This makes us go “mmmmmm”…. Let’s see though, if it can break that downtrend it might put in a strong move higher.

FirstRand (FSR)

Sticking to the theme of strong banks for a little bit, we see a bull flag (flat) that has broken on FSR. This triggers a long trade with a good risk-reward.

Naspers (NPN)

Again we’re adding NPN because we think it is an important chart to keep aware of. We’ve spoken about the range for many weeks now. When this eventually breaks, there will be fireworks. Keep watching it and stay patient.

Netcare (NTC)

Maybe a cheeky little long here from the bottom of the range on NTC?

Reinet Investments (RNI)

RNI once again breaking a consolidation to the upside. Decent trend following long trade here we think.

Join a winning team

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

Offshore stockbroking rates

Subscribe for post updates

If you enjoy reading our blog and would like to get email updates each time we post, please subscribe below.

*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.

The post Up she goes! appeared first on Herenya Capital Advisors.

Now, yes, we did say this a few weeks ago and the market has remained persistently strong. Relatively at least… U.S. markets are slightly higher, but locally markets are slightly lower. So, no real fireworks just yet. Perhaps the momentum finally shifts down, and we see the market come off a little? Particularly in the over-hyped tech sector. Let’s look at some charts and get a better idea of why we’re thinking what we’re thinking.

*Also, please just note that as usual, the offshore indices we chart are in fact ETFs of those indices as those are tradeable. If you are not trading offshore for only $2 a trade, click on that open account button. Top right. You got it. Ok, time for charts.

Bigger picture (Offshore trade ideas)

S&P 500 (SPY)

This is ironically one of the charts that is not so clear to us right now. The levels marked in yellow are our up and downside targets. We think down before up and it should be noted that if $418.31 doesn’t hold, we could see this push to $400. Also, that does look like a double top, does it not?

Nasdaq (QQQ)

QQQ is a lot more clear to us than SPY. Once again we see the double top, but this time it is in fact directly below the resistance level we pointed out a few months ago. It feels like this bullish move has now run its course and it’s time to wobble a little. Our thinking is that we will likely see QQQ come off to test the previous significant horizontal level (also marked in yellow) at $333.57.

Philadelphia Semiconductor Index (SOX)

SOX found some resistance at the top of the channel. Momentum is shifting toward the downside, and if you squint just right you might see a little head and shoulders pattern. Look out below! Time to wobble.

U.S. Dollar Index (DXY)

Friday came along and said woah! It looks like that support at $101.30 is going to be tested once more. The question we are asking ourselves is ‘are we forming a base here or are we forming a flat?’. In other words, does $101.30 hold and this is the long-drawn-out starting phase of another bullish move over the next few months/years? Or, does the support break on the third attempt and we see the Dollar weaken substantially going forward? Time will tell. Time to wobble.

Brent Crude Oil

We could probably pose the question as above (with DXY) here on Brent. The way we see it is that Brent has been bouncing between the bottom and the mid-point of the range for a few months now. We’d like to see it break above $79 and head for $87. The start look aligned here. We’ll look at a Sasol long as well.

USDZAR

Time to wobble? But its so wobbly already! That’s a volatility joke by the way. This chart is, well, maybe we need new ideas and perspectives here. To us, this looks like a monster bear flag… but it could also go to R19.50. Let us know what you think on Twitter.

Platinum

Platinum might have gone a little far on the downside here and from our perspective it looks like it is going to try put in a little bounce here.

Gold

Gold is looking fairly bullish right now as well. At least, it looks like a decent bullish setup complete with a bearish equity market view to back the risk-off idea. Let’s see if it can get going.

Apple (AAPL)

This trend looks a little long in the tooth. We’ve marked out our trailing stop for AAPL longs. A daily close below $188.92 will stop us out of a position that has done really well. It is worth noting that when it is time to wobble for these giant tech stocks, the rest of the market will surely follow. The majority of the Nasdaq Index and a big chunk of the S&P 500 Index are in just a handful of stocks that are all highly correlated. Once the tech giants begin to wobble a little, the straw house that is the U.S. stock market at the moment is likely to be blow over.

Applied Materials (AMAT)

As a way of example, looking at AMAT, we see that our trailing stop has already been triggered. Now, AMAT is not as exciting as AAPL or TSLA or NVDIA or (insert any A.I. stock in here), but AMAT is a large supplier to many of these companies. Semiconductors have to be made somehow, right? AMAT might be the canary in the coal mine here.

Microsoft (MSFT)

MSFT is also teetering on the edge here. A daily close below $332.81 will trigger the trailing stop loss. As is the case with the illustrated trailing stop losses above, these could act as short entries for the more active traders. Just be warned, you’re betting against the trend, so keep tight stops.

South African trade ideas

JSE Top 40 Index (ALSI)

Well, well, well, if it isn’t the good old ALSI heading for the longer-term trendline? At least that’s our view. Buckle up, it’s time to wobble.

Compagnie Financiere Richemont (CFR)

It’s not often that you see such a beautiful break and retest of an established trendline. Textbook short setup here.

Naspers (NPN)

Going nowhere slowly… but, keep it on the watchlist as you can trade it between the levels, and when eventually this range breaks, it will do so in glorious fashion!

Shoprite (SHP)

Retailers have done alright recently. SHP underperformed a little over the last few days of last week though. It also looks to us like it wants to go test R192. It’s time to wobble, hold onto your stops!

Sasol (SOL)

SOL has bounced off this level once before… and then came back and slammed right back into it. With the Brent Crude Oil context above, and with this level actually holding fairly resiliently, we think that it makes a great long trade from here. Easy tight stop and a potentially a huge amount of upside.

Thungela Resources (TGA)

If you have been keeping an eye on energy demand forecasts, weather and other going-ns in the energy space in Europe, you will note that there is a slight shortage of the burny black stuff (coal) brewing. This once again plays into TGA hands. Combine that with a falling wedge, very recent higher lows, and you get what looks like a really good long setup for a medium to longer-term trade.

Anglo American (AGL)

Bullish divergence off a significant horizontal support level. Bodes bullish to us.

AngloGold Ashanti (ANG)

So the trendline broke and the head and shoulders worked out perfectly and the trendline is now being tested. Ok then. Given our thoughts on Gold (and Platinum) above, ANG might be presenting a nice long trade opportunity for those who are willing to take a little risk.

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If you enjoy reading our blog and would like to get email updates each time we post, please subscribe below.

*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.

The post Time to wobble appeared first on Herenya Capital Advisors.

For the last few weeks we’ve harped on about ‘it not needing to make sense, we just follow the market’, but over the last week it seems that the ‘follow through’ is not there. In other words, the market is starting to feel the need to make sense again, which makes us a little bearish. There are still many signs that point to a slowdown/recession in the second half of the year and more and more signs pointing to a looming credit crisis/crunch. Canada put up interest rates unexpectedly, U.S. student loans are once again becoming payable (aka. households have had a reprieve from making payments on student loans and that reprieve is now over, so payments are once again due). Overall, the economic grounds are shakier than what Joburg was a 02:40 on Sunday morning.

Bigger picture (offshore trade ideas)

S&P 500 (SPY)

So, the 4300 level ($430 on SPY) put up a good fight and won. Our horizontal resistance level is marked out at $429.50, although we know that these support and resistance levels are more zones than absolute levels. Thus, the attempted break higher that failed on Friday is rather significant in our view. Momentum is looking a little stretched too. In the bigger picture, we have the making of a longer-term trend change here (from bearish to bullish), but in the short-term, we think that the market is very likely to come down and test the 4200 level ($420 on SPY) again. There is a metric ton of economic data due out next week, so it is a bit of a wildcard week, but from where we sit, it doesn’t look like there is going to be much good data coming out. Thus, we expect the market to be softer in the week to come. As always, we would be happy to be wrong in this regard, but the start of the week might prove a good time to bank some profits on local (South African) long trades that have worked out.

Nasdaq (QQQ)

There is not too much to add to QQQ that was not said above. Although, we do feel that we should stress that Tech has had an amazing run on the back of all this A.I. mania. We’d said a few times over the last week that we think the A.I. bubble is only just beginning, and we still believe so, but some of these tech stocks (NVDA for example) have gone a little far and are due for a pullback in our view. We also see waning momentum in QQQ and a failure to make a new high. Brace for some downside we think.

Gold

We won’t reiterate our downside (range) target for gold every week as it is a multi-month, potentially multi-year setup. That said, we have to wonder if we might not see gold pop a little on the back of weaker equities in general..? Overall, we are still bearish here. It would not be crazy to imagine gold coming down while equities are coming down, specially on the back of bad economic data and some fresh panic. Let’s see how the week goes.

U.S. Dollar Index (DXY)

It’s looking more and more like DXY will test the 101 level. The surprise BOC move (hiking interest rates in Canada) contributed to some USD weakness. Bad economic data in the week ahead will likely add fuel to that fire.

Brent Crude Oil

The Saudis have just about thrown every kitchen fitting at the oil price to get it to go higher and still it won’t budge. This makes us worry a little. If that $70.50 level breaks, $60 might be on the cards. Slowing global growth (aka. recession) and persistent inflation will likely keep putting the breaks on oil prices. We can no longer be bullish here under the current circumstances.

USDZAR

We asked for reprieve and we got reprieve, in a big way! Time for that Kansas City Shuffle though. We’re happy to take some speculative longs around R18.60. Keep a tight stop though.

S&P 500 Volatility Index (VIX)

VIX sub 10 lows would mean that things are ‘back to normal’. While we think that this will likely be the case rather soon, with a doji candle and all the long stories about headwinds we’ve already told above, a test of 16 or 18, or even 20 in the week ahead is likely more probable.

South African trade ideas

JSE Top 40 Index (ALSI)

We’re looking at a weekly chart here on the ALSI. To us it looks like the momentum has started running out and that a move to be bottom of the upwards sloping channel is the most likely move from here. We know that CFR has had a huge impact and that will be no more, so maybe the ALSI comes back down to earth a little.

AngloGold Ashanti (ANG)

Well would you look at that? If it isn’t a beautiful head and shoulders pattern with a target at the primary trendline? It’s makes sense though. Gold is looking wabbly, the Rand has gotten a huge amount stronger. The party is over here for how. ANG is probably worth a buy sub-R400, but for now we think that there is around 20% worth of downside to come.

British American Tobacco (BTI)

We’re just updating the BTI chart here and reiterating our R584 target price.

Aspen Pharmacare (APN)

APN bounced a little, but momentum ran out pretty quickly. Maybe it’s time for the Kansas City Shuffle here too? We’d take the money off the table from the long trade here and run.

Bidvest (BVT)

BVT finally breaking the flag and putting in a good run. As is the case with APN above though, maybe it’s time to go left while everyone is going right? Take the money and run, in other words.

Compagnie Financiere Richemont (CFR)

Look out below! Well, ok, it’s not that simple. Yes, this chart is looking terrible and yes, there is a ton of selling that needs to be done in order to get index trackers inline with the rebalancing. But, and a big but, CFR is one of the most shorted stocks (in proportion to market capitalization) on the JSE at the moment. Everyone is thinking that this is the easy trade, and look, it probably is, but when it squeezes, which it eventually will, it is going to hurt the overleveraged shorts in ways that they will remember for many years. We do still like the short though.

FirstRand (FSR)

What a move from FSR! ‘Locals’ have done really well, and there are lots of arguments why they are all undervalued and why South Africa is ripe of the picking (aka. buy local stocks over offshore), but again with buts, FSR has slammed head on into the R68 resistance level. We could add a support level at R60 here and it would not be completely unreasonable to think that FSR will come back to test it.

Gold Fields (GFI)

Many years ago I (Petri) worked at a small hedge fund in Cape Town, and there my old boss taught me one of his favourite setups. He called it ‘The Eye of Sauron’. Basically, a failure to make a new high very shortly after a pullback at the top of long upward move. Almost a double top, but weaker. Now, The Eye of Sauron sits atop the GFI daily chart, and it looks down at the primary trendline with malice. And it broods. This is going to be a great short trade actually.

Naspers (NPN)

NPN has been pretty range bound, with the odd fake break out the bottom. We have this feeling that the next break out the bottom will not be fake though. R2785, then R2330. The lower target is less likely, but R2785 we think is rather probable indeed.

Sanlam (SLM)

SLM has also had a great run (see FSR comments) and has also slammed into resistance (at R59). For now, we think this party is over and we will be seeing the R51 support fairly soon. Great risk-reward here too, with a super tight stop and almost R8 on offer. A daily close above R60 takes you out of the short and an intraday high above say R61 does the same. Remember though, there are stop hunters out there who will squeeze you to take your money, so trade small(ish).

Sasol (SOL)

SOL forming a nice little base here and longs from last week worked out rather well. Given the oil and general macro narrative above, we think maybe its time to pack this one in for now. Well, for short-term traders at least. For the longer-term investors, SOL is likely still a good hold.

Sibanye-Stillwater (SSW)

SSW is looking for that R31.80 level with a sore heart.

Telkom (TKG)

So… TKG rejected an offer for R46, because it is not enough. Word is that the ‘buyers’ are still sitting around the negotiating table. It smells like TKG pops in here.

Subscribe for post updates

If you enjoy reading our blog and would like to get email updates each time we post, please subscribe below.

*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.

The post Kansas City Shuffle appeared first on Herenya Capital Advisors.

Yeah ok, a little dramatic maybe, but that is what it feels like. Here are the charts:

Bigger picture (offshore trade ideas)

S&P 500 (SPY)

Well, well, well, if the SPY didn’t manage to break the resistance level? It’s not exactly at $420 as we have been calling, but the resistance is broken, nonetheless. The American Bull is strong! Perhaps too strong to keep down. And we are sure that there are plenty of shorts out there about to get squeezed till their eyes tear. It might not make sense, but we are here to follow the market – not make sense of it… thus, we go long.

Nasdaq (QQQ)

And here is the source of the power for the foolishly strong American Bull. Tech. It’s been on a tear and has finally now made a new Dow-Theory-High. Uncomfortably, we have to concede here that all indications point to a turning of the trend and the beginning of a few up-phase in markets.

S&P 500 Volatility Index (VIX)

We’d thought we’d see the top of this range before seeing the bottom again, but alas, the American Bull had other plans. Not shown here is the pre-covid lower end of the ‘normal’ VIX range. Perhaps we break this sub-16 low support and the VIX finally returns to its ‘normal’ before the world got duped by covid?

Brent Crude Oil

Nothing really to report here. Oil is still in this range we’ve spoken about for the past few weeks. We’re only interested again once this range is broken.

Gold

The same could be said for Gold really, as our view has not changed since last week. Gold is at the top of the range and is looking rather likely to move toward the bottom end of the range. Since the American Bull over here is trying to break higher (see SPY), risk on sentiment is returning and Gold might get the axe, so to speak. We think the focus shifts away from Gold and onto PGMs and Industrial Metals from here.

U.S. Dollar Index (DXY)

It looks like DXY has formed a decent base at 101.30 and is starting to break higher. It’s found some resistance at 103.70, which is not unexpected. Up through here and 105.30 is the next stop. Fuel to the ZAR fire if you ask us…

USDZAR

The headlines truly have been sensational. There is some expectation that, since the story emerged that it might in fact have been SA buying weapons from the Russians, the ZAR might strengthen tomorrow. Personally, we hope so, but we’re not holding our breath. The channel target is the moon… uhm, sorry, around R22 to the USD. So, let’s hope it never gets there.

All Country World Index (ACWI)

Good ‘ol ACWI seems to be feeling the influence of the American Bull as well. It looks to us like it’s broken our of a key resistance level and is ready to trade higher. Risk on is here.

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South African trade ideas

JSE Top 40 Index (ALSI)

It’s no secret that we’ve been bearish. It’s not been fun. We’re not turning into bulls on SA inc. here either. We just want to remind our readers that the index rebalancing is coming and CFR is not going to be 17% of our index anymore. This may or may not have a big influence on the ALSI as much of the ‘power’ behind it will be gone. SA inc. has not been having a great time and this is not reflected in the headline index. We suspect that once CFR is largely reduced in weighting, the index might surprise to the downside. ALthough, we’ve been saying that for a few weeks now, so take it with a pinch of salt.

Investec (INL)

INL trade seems to be on track. It’s a volatile and less liquid stock in general, so the rather large down day on Friday does not worry us too much as it is not ‘out of the ordinary’ for the stock. Sorry, couldn’t resist. The weaker ZAR surely helps and we’re still looking for above R116 in the short-term.

Textainer (TXT)

No actual trade idea here on TXT. Just a weekly chart trending like a dream. From R150 to R700 in three years. Not many of those around in this market.

Sun International (SUI)

This is a messy chart, but what we are looking at here is two-fold. First, the yellow is a flat-top triangle that has broken higher and has been retested. The white lines shows some bullish divergence (and a bit of a bounce off the R37 level). We like this stock for a long.

Sibanye-Stillwater (SSW)

We had lift-off from this level once before already, and we felt pretty smart at the time. Since then the sad trombone has been getting louder and louder. But, on the bright side, we’re back at the support level and ready for another try at launching this little stock to the moon. Easy long trade here in terms of a clear stop loss and large risk-reward ratio.

City Lodge Hotels (CLH)

Nothing really to report here, other than to reiterate our R5 target price for short-term traders, and the moon for the long-term investors of course.

Anglo American Platinum (AMS)

The AMS idea has been floating around a bit, but it doesn’t seem to be working out so well. We’ll keep the faith for another week, but below R1100 our commitment to this long idea ends.

British American Tobacco (BTI)

Another winner from the ZARs pain here. BTI has been holding the middle here and we think that a long from here to R710 could be a decent play. Stop under R620.

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*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.

The post American Bull appeared first on Herenya Capital Advisors.

Bigger picture (offshore trade ideas)

S&P 500 (SPY)

So the SPY still has not taken out the $420 level and thus we still cannot turn bullish on S&P 500 stocks, or the global economy as a whole. There is not really too much to add here that we have not mentioned over the last few weeks. If SPY can take out the overhead resistance, get buying. Until then, either stay short or stay out. We must wait for a confirmed signal before we can make any longer-duration directional calls.

Nasdaq (QQQ)

And in absolute contrast to what we just said above, we think that tech is likely worth buying. QQQ just does not seem to care about the macro picture. We think this could be for a variety of reasons, although one of the most obvious are that big tech were among the first to cut jobs when times started getting tough. Thus, their earnings are likely the most ‘protected’ when compared to other industries. Also, companies like Apple are becoming banks (which, during a banking crisis, seems like a genius move to be honest), and other large cloud computing providers like Microsoft and Amazon, and of course the chip manufacturers that support those industries, are on a path of rapid and accelerating growth. Maybe during these confusing markets it might be time to buy tech again?

USDZAR

Alright, let’s get into it… we look at two charts of the USDZAR. First up is the daily chart. Such a beautiful breakout (which we pointed out on twitter on Thursday), well done to those who caught it. We’ve been whipsawed by the ZAR over the last few weeks, but this sideways pattern it was in had to break at some point and it clearly chose the path of pain over the path we would have preferred, but so be it. The second chart is a rather unpopular chart we have been putting up every now and then for a good while now. It is a weekly chart showing the upper end of the channel at around the R21 to R22 area. Maybe we see the ZAR fight back some on Monday, but honestly, will all that is happening locally with electricity, growing unrest and food security concerns… buckle up buttercup, it’s going to get wild. We hope we are wrong.

U.S. Dollar Index (DXY)

We expected DXY to break support and trade toward 99.50, although it seems that DXY strength won the day. The question we are asking now is, does the DXY range between 101.30 and 103.70, or, 101.30 and 105.30? Also, to be fair, we’re not so sure that DXY strength or weakness will have much of an impact on our local ZAR anymore, given the rather strange and unique circumstances and events surrounding our own currency.

Gold

Well, it seems that gold might actually be holding this upper resistance level. If that is the case, perhaps a short from here back to the bottom of the range? You will have to keep a tight stop though.

Brent Crude Oil

No move to the top of the range then..? if $70.45 breaks to the downside, it’s over for oil and energy stocks.

American Tower Corp. (AMT)

Not a trade idea yet, but watch for a bullish break here.

South African trade ideas

JSE Top 40 Index (ALSI)

Nothing to get the ALSI bid quite like the ZAR blowing out! Despite basically all the locals being under massive pressure, the dual listed stocks have been pumping! Not to mention the great CFR, which my itself at one point added over 1100 points to the ALSI rally on Friday. We’ll look at CFR next for some guidance, but we are cautious of the longs here.

Compagnie Financiere Richemont (CFR)

If CFR gaps down on Monday and puts in a close below R3200, that would make the shooting start to end all shooting stars! So maybe, just maybe we might see that ALSI short working out? That is a pretty big maybe though and we’re not really all that keen to bet against the madness of markets. This candle is not very bullish though and might signal the top of what was one crazy move. A gap lower at the open is worth selling into, just keep a very, very tight stop.

Investec (INL)

INL is still looking pretty good. The weaker ZAR should help a little as well. We’re holding out for between R112 and R116 for now. A close below R100 and we’re out.

City Lodge Hotels (CLH)

CLH long is looking very good. R5 target price should do just fine, thank you very much.

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*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.

The post Confusing markets appeared first on Herenya Capital Advisors.

Bigger Picture (offshore trade ideas)

S&P 500 (SPY)

SPY has still not cleared the $420 level (4200 on the index). Yes, Friday was a ripper, but SPY still ended the week lower. As long as SPY stays below $420, we will remain bears. If, or once, SPY breaks above $420, we can buy into that strength, but until then we will remain very cautious and distrusting of this market.

Nasdaq (QQQ)

The QQQ looks a little better as it managed to close near the weekly highs and looks to be in a more bullish setup. It is almost as if this entire index is hanging on to Apple and if anything happens to the titan, things might turn sour for QQQ. It’s hard to shake our bearish bias here, but QQQ might turn out to be the thing that changes our view. The contrast between the setups on QQQ vs SPY is indicative of the tug of war happening in the market, and thus the tug of war happening with our views. The safest bet is likely to step back and allow the market to unfold a little before making any risk-taking decisions. It’s ok to miss the first part of the move, so if our predominantly bearish view here is wrong, we are happy to buy into a new bull market if it comes. For now though, we are still playing the defensive game.

S&P 500 Volatility Index (VIX)

The VIX got going nicely during the week, although Friday saw a turn in fortunes. As you can tell by now, we are not convinced and we stand by our call to buy VIX calls. The tug of war is only going to get worse in our view, and the VIX should pump a little off all this uncertainty.

Gold

We put out a gold chart on twitter on Thursday asking if this might be the top for Gold for now. After Friday’s session, it looks like that might well have been it. Again though, we are not entirely convinced. The facts here are that the Chinese and Russians are still buying record amounts of Gold in the physical market, and the economic headwinds facing the more Westernised Developed Markets have not gone away. Maybe a soothing balm was put on the wounds on Friday, but the reality here is that there is a lot more pain to come. At least, that is what we think at this moment. We are open to Gold moving down somewhat from here, but our base case expectation is that Gold will likely keep pushing and more than likely print a new all time record high. Hold on folks, the tug of war is going to create a lot of volatility.

Brent Crude Oil

Oil managed to get to the bottom of the range we pointed out a number of weeks ago. A bounce back to the top of the range is very likely and we will be using it as an opportunity to get out of the last of our oil facing equity holdings. If the ‘mild’ (narrator: it won’t be mild) global recession in the second half plays out, there is almost no way that Oil will be able to hold the $70.50 level, even if OPEC cuts production aggressively.

U.S. Dollar Index (DXY)

Some time ago we would be arguing that given the bad global economic conditions, the USD should strengthen as investors seek ‘safety’. Now though, maybe investors are starting to realise that Dollars (and the USA in general) might not exactly be as safe or strong as they had always thought. We think that there is a bit of a global power shift happening and that, sooner than we think, BRICS will be the new global powerhouse. DXY below 101 opens for bearish trades and stronger Emerging Market currencies. This will be in our favour.

USDZAR

A bit of a sideways consolidation / tug of war here. Keep your eye on DXY for guidance. We think that a weaker USD is the most likely outcome, so we are calling USDZAR to R17.60.

South African trade ideas

JSE Top 40 Index (ALSI)

So alright, we are bearish on the global picture. It is difficult and painful to be bearish on the local front though. Sometimes markets defy our beliefs… what’s happening here though is the power of rand hedged stocks, commodities stocks and of course, Richemont. CFR currently makes up around 17% or so of the total weighting of the ALSI, which is A LOT. CFR has also been running very hard thanks to luxury goods generally making record profits while the world falls apart. Eventually, well, rather soon actually, CFR will be downweighted in the ALSI and its influence of the headline index will lessen. We think that once that happens we might see the ALSI come inline with global markets a little. For those who entered the short on the tertiary trend line break, you can move you stop to the 72700 level.

City Lodge Hotels (CLH)

CLH has been power! Nice bullish setup here with a target between R4.60 and R4.80. We’ve seen a return of both local and international tourism in South Africa and hotel groups are looking very attractive at the moment.

Sibanye-Stillwater (SSW)

SSW has not run as hard as most of the goldies, but SSW is not exactly a gold stock anymore. It’s been under some pressure thanks for the three other constituents of the PGM group (Platinum, Rhodium, Palladium – and Gold of course). Finally it is starting to show some signs of life. Remember also that Froneman bought SSW stock just above R36, and he has a great track record of trading his own stock. Hold on to your longs here, because in a year or two from now we might see SSW back at R70 or higher.

Anglo American Platrinum (AMS)

AMS has also not participated in the gold rush, obviously because it is not gold. But as is the case with SSW above, AMS is starting to look really attractive. Entering a long here with a first target of R1300, second target or R1400 is in our view a low risk easy trade.

Bidvest (BVT)

Another bullish setup here on BVT. Wait for this flag to break and take the long if you are a trend follower.

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*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.

The post Tug of war appeared first on Herenya Capital Advisors.

On a more serious note though, the market has been super wild and things are actually starting to look pretty bleak again. It takes some work to try and stay flexible in mindset in these conditions because there is a lot of evidence that things are bad and getting worse. Banks are collapsing, Oil is cratering, global conflict is escalating and come Monday in our local environment… well, perhaps this is not the place to express opinions on that. The point is, either it is now darkest before the dawn, or the night gets even darker. The eternal optimist in us chooses to believe that things will look up shortly, but the pragmatist looks around and starts to plan for the inevitable.

What does this mean for your trading though? And likely more importantly, your investments? Well, we will admit that we’ve been whipsawed a little of late, but we are still holding around one-fifth in cash. Last week some members of our investment committee (Petri, it was Petri) felt a little more panicked than the rest and wanted to free up even more cash to at least cushion the fall a little, but sanity prevailed. The facts here are, well, that we don’t know what comes next and not panicking is definitely the best move that we can make.

So let’s see what the week ahead holds. The world is once again starting to bet on a Fed pivot… maybe the conditions for that are now finally right? Maybe the Fed knows that it’s going to get worse and will stay the course to keep inflation in check. Who knows? All we can do really is follow the charts, follow the macro data, and sit quietly while the bus clammers and clunks its way through whipsaw city.

Bigger picture (offshore trade ideas)

S&P 500 (SPY)

So alright, maybe it did not bounce off the tertiary uptrend line, but it is still sort of holding above the primary downtrend line. So, keeping a flexible mindset, this could still be a retest of the broken downtrend and a trend change scenario. There is of course the chart comparing this current bear market to the 2008/09 bear market, which is the fractals are correct, indicates a whole lot more downside. Just a few weeks ago we would be in that camp calling for the bottom to fall out, but as we sit here today, we have to stay open to the idea that the market could be turning. Should we see a move lower, back below the primary trendline, then we will have sufficient evidence to be convinced that we will see a new low (and ironically, this will put our original downside target from 13 or so months ago back on the table). So let’s see what happens. Just keep tight stop losses.

DAX Index (DAX)

When good trendlines go bad! The trendline eventually broke and the initial target was hit. Where too from here?

Hang Send Index (HSI)

If you look closely, there is some bullish divergence there over the last two or three weeks. Just saying. Whipsaw city is a real place. If you forced me to trade here, I would go long.

Nasdaq (QQQ)

Talking about things I would buy if I had to buy something… QQQ is looking very strong given the greater macro madness taking place in whipsaw city! Maybe tech is going to start outperforming energy again for the next few years. Definitely something to keep an eye on.

U.S. Dollar Index (DXY)

DXY looking to retest the 101.30 level. Wait for the break below 103.70 (which then becomes your stoploss).

Gold

What a rally! Gold stocks pumped hard off the back of this as well, and likely will rip higher on Monday too. $2000 might be a bit of a strong resistance level, but once through that, maybe we top out above $2080 this time?

Brent Crude Oil

Oil is probably the primary factor that makes us rethink the ‘this is the low and we’re going up from here’ thesis. Oil is back in the downward sloping channel as global recession fears dries up demand. Unless we see a turn here, odds are good that equities will keep selling off. Maybe that 2008/09 fractal is right?

VanEck Junior Gold Miners ETF (GDXJ)

Well, there is always a long trade somewhere and GDXJ is looking prime to make a new high. Our first target here is $42, second target is $48. It will take some time, but the high gold price is really going to help get the junior gold miners going.

USDZAR

Once again we show the weekly chart and the large upward sloping channel with a price target of R21 to the USD. Not a pretty picture, we know… and if things get spicey on Monday, we’re sure that wont help. This will make for a great trade though, as long as you don’t over gear yourself and have some patience to let it play out over the next few months.

South African trade ideas

JSE Top 40 Index (ALSI)

The very steep trendline broke, had us second guessing ourselves for a short while, and then the ALSI melted like soft butter in a normal fridge during stage 6 loadshedding. The downside target here is the zone market in grey (between 64k and 65.5k). The brave traders would likely buy some near here as we know that the market will bounce and if the ZAR blows the rand hedges will help support the index. We’re not sure we count among those brave traders at the moment though.

Compagnie Financiere Richemont (CFR)

Despite the ZAR support here, we think that CFR will test that R238.60 level in due course. Global recession fears will likely be a more powerful force than a weaker ZAR.

DRD Gold (DRD)

A nice little bull flag here on DRD, backed by global economic meltdown… uhm, we mean higher gold prices. We mentioned above that the junior gold miners will likely be big winners in this, and DRD is a fine example of that.

Naspers (NPN)

R2780 incoming! That little range break at the high was a great short entry. It really tested your steel when it retraced to above R3400, but the fat lady is currently singing and the short is a nice place to be.

Remgro (REM)

No real trade to do immediately here, but maybe worth a buy around R125.

Sibanye-Stillwater (SSW)

SSW is a much more complicated play these days as it has so much more than just gold. Palladium and Platinum have not exactly had the best time either, nor do they have great looking charts. Nonetheless, if R36 can hold, we think that an entry here for a medium-term trade can work well. Just keep an eye on R36, because a break there will open up for R32.

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*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.

The post Whipsaw city! appeared first on Herenya Capital Advisors.

Bigger picture (offshore trade ideas)

S&P 500 (SPY)

Well, well, well… the downtrend line held like a champ and the market bounce something furious. As much as we opine about the market and have all sorts of strong views about what we ‘believe’, we are essentially just trend followers. The market takes the lead and we do not try to fight it. If we see SPY get higher than $420 (lol), then according to the simplest of the simple and clean, good ‘ol Dow Theory, we have a bull trend. The market leads the economic cycle by 6 to 9 months. Perhaps it knows something we don’t? [spoiler alert: it does]

Nasdaq (QQQ)

QQQ snapped back as well and broke right back above the key $297.25 level we indicated a while back. The same applies here as above. A new swing high would indicate a trend change.

All Country World Index (ACWI)

ACWI having a go at making a new high too it would seem.

Brent Crude Oil

Bullish equities = bullish oil! This chart is also a slow motion trend change in the making. There were some rumours that some countries might be leaving OPEC, but they were nullified rather quickly and oil caught a big bid on Friday. If equities are leading the economic cycle, then we can assume energy demand will keep growing and thus, so will the price of oil. We remain bullish energy in a big way.

Gold

Even ‘ol gold is looking like it wants to put in a new swing high.

U.S. Dollar Index (DXY)

Momentum wise, DXY is looking like it wants to soften a little. This would be good for equities and commodities in general. We have to admit, we did think this chart would go on to make a new high, and yet, here we are starting at it like a deer in the headlights not sure what to make of it all. We should probably leave it alone, but for now we are going to call it lower during the week ahead.

USDZAR

R18.50 held strong, and truth be told, we still think that over time the ZAR will keep working its way to R20 and above. In the short-term though, which is probably why most of you guys read this blog, it seems very likely that we’ll see the ZAR test the R17.60 level as equity markets rally somewhat in coming weeks.

South African trade ideas

JSE Top 40 Index (ALSI)

Well, the trendline break gave us a short and sharp sell off… which was fun while it lasted. Given all the bullishness in the international arena, does this mean the bull is back locally as well? Momentum shows bullish divergence and the trend has been fairly strong. There was some bad news on Naspers over the weekend (well, Tencent), but will it be enough to completely ruin the party here? We don’t know to be honest, so let the week unfold and remember that risk management is king.

Aspen Pharmacare (APN)

Weekly chart here on APN. We waited rather a long time for this bullish break, so you can bet that we are in. Shorter-term traders might not want to chase too hard here, but for those who are willing to take a smaller bite and wait a bit longer, we still like this stock.

Reinet (RNI)

We’re really just putting this one up as a bit of bragging rights. We hope that some of you took this trade when we pointed it out a few weeks ago. Let us know on twitter if you did. Also, bank your money.

Sanlam (SLM)

We hereby formally retract our bearish stance on SLM and move it to ‘neutral’. If this stock can open above (and hold above) R59.05, buy it for an intraday trade.

Old Mutual (OMU)

OMU leads the way. Trend followers can comfortably be long here we think.

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*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.

The post Does that mean the bull is back? appeared first on Herenya Capital Advisors.