Ok ok, honestly, we’re lazy. It is literally the last Sunday of the year and the third-last day of the 2019. The week that lies ahead has one half-day (31st) and one public holiday (1st), so there is not really going to be too much going on, on the JSE. This week will also mark the period during which the seasonal Santa Rally comes to an end. So far so good with the Santa Rally as markets are mostly higher. The base case expectation is that this coming week remains strong, once again on low trading volumes. On the 2nd of January though, comes Initial Jobless Claims data from the U.S. which could add a bit of a surprise catalyst to the market if it is far outside of the expected range. For the most part though, we expect the week to be quiet with a bullish bias, at least for our local market.

S&P500

So yes, we a bullish bias on the local market and Emerging Markets in general, although in the short-term the S&P500 is starting to look a little stretched. Since the breakout of the indicated resistance level around the 3000 mark, the Index has traded very well. From where we stand though, it does look like it might be due a slight correction, at least in the very short-term. We wouldn’t expect any potential pullback to be more than 5% to 10% and if global markets in general remain as robust as they are now, a short-term correction could present a great opportunity to buy both equity and index futures positions. But, we will have to wait and see. For now we are not taking any trades here, but are watching to see if we indeed get a correction of sorts, and if that correction is going to be worth buying into.

ALSI

The ALSI has been rather range bound over the last few sessions and it seems that it is at somewhat of a tipping point now. The Stochastic Oscillator is starting to show signs of building bearish momentum, while the MACD is still in bullish mode. Price has formed a daily range of around 1 000 points which, as we know, has to break at some point. As mentioned before, our bias is bullish, although we will let the levels indicated on our chart below act as our triggers for any trades to be taken both long and short.

Clicks

CLS has received a lot of attention recently. Even though the stock has consolidated some, the breakaway gap it made when results were released is still in play. We would like to see price get and hold above R265 in order for us to enter into long positions on the stock. The brave could probably try to pick it up at around R245, although a break below that level could signal a change in trend.

*Please note that these trade ideas for 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.