TECHNICAL ANALYSIS: S&P 500 index break-out good news for JSE | Fin24
 
Loading...

TECHNICAL ANALYSIS: S&P 500 index break-out good news for JSE

May 17 2018 12:50
Colin Abrams

After a 3½ month consolidation, with some violent moves in both directions, the S&P 500 index has finally broken out to the upside, with a significantly higher target now in place. This is good news for the JSE that tends to follow the US stock market.  

S&P 500 INDEX – New breakout

Recommendation: BUY

Current Trend: Short-term up. Med-term sideways. Long-term up.

Strategy: Buy on a one or two day pullback for ongoing upside.

(Daily)

Capture

Chart Setup: After finding support at its 200-day moving average a few times, the S&P 500 index has broken out above first line 2 resistance, and now line 3. This is very positive news for US and world stock markets, including the JSE. Lines 1 and 3 form a symmetrical triangle, with a higher target now in place.

  • Its short-term Stochastic (on top) is overbought so a minor pullback is very likely before it heads higher.

Strategy Details: Buy it on a one- or two-day pullback.

Target: It is now targeting 2 980 over the coming months, based on the height of triangle 1-3 projected up. (It was at 2 730 at the time of writing).

  • To the downside, closest support is line 2 at 2 684.

Stop-loss: A closing price below 2 650.

  • Colin Abrams is an independent technical analyst. To subscribe to more recommendations by the author, or attend trading courses, please go to www.themarket.co.za

Disclaimer: Fin24 cannot be held liable for any investment decisions made based on the advice given by independent financial service providers. Under the ECT Act and to the fullest extent possible under the applicable law, Fin24 disclaims all responsibility or liability for any damages whatsoever resulting from the use of this site in any manner.

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest. 24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

equities  |  markets
NEXT ON FIN24X

 
 
 
 

Company Snapshot

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

What is your reaction on Tito Mboweni's announced VAT exempted items?

Previous results · Suggest a vote

Loading...