Senior Analyst, Rand Swiss

Shaun is a senior analyst specialising in derivatives trading and technical analysis across index, commodity, FX, and equity markets. With nearly 20 years of experience in financial markets, Shaun brings deep expertise to his role, presenting research and analysis to Rand Swiss clients. Shaun is a regular commentator on local and global financial markets, contributing to major media outlets including CNBC Africa, Reuters, Moneyweb, and Business Day. He produces daily and weekly market reports focused on technical analysis and trading opportunities in his core markets. As a registered person at the JSE and a Certified Financial Technician (CFTE), Shaun combines formal credentials with practical market expertise.

You can follow Shaun on Twitter at @ShaunMurison_RS for regular market updates and trading insights.

Key levels hold amidst heightened volatility

This week’s edition of Tech Tuesday finds several markets reasserting trend-aligned moves after recent consolidation. While volatility remains elevated, price action across indices, currencies and commodities suggests improving short-term momentum.

Inside this update:

• J40 Cash Index
• ZAR
• Commodities
• JSE Sector Analysis & Trade Setups

J40 Cash Index

The J40 Cash Index price has now confirmed another bullish reversal (circled blue) off trend line support and from oversold territory. Overhead resistance at 113870 is relatively close. To unlock a potential move back towards the highs, traders might hope to see a close above this level (113870).

Where to place our stop loss is a tricky consideration with the sharpness of the moves we have seen. Our preference is to use a move below the circled candle as the initial stop loss. If we do get the break above resistance, we would then consider trailing the stop to a close below a one or two day low.

ZAR

USD/ZAR

The USD/ZAR once again respected the 16.30 resistance level testing it before resuming the long-term downtrend.

Provided that 16.30 remains (unbroken) resistance, 15.63 remains the near-term support target from the move.

Commodities

Gold

Last week’s rally lost momentum with the price retesting the 4740 level. Circled blue we now see a bullish price reversal off this level, suggesting that the long-term uptrend is resuming.

A move towards 5443 is favoured, while a close below the 4740 level might be used as a stop loss consideration.

Brent Crude Oil

The bullish reversal off support highlighted in our previous note confirmed, with the price now having reached the initial resistance target of 69.60.

Should today’s price manage to close above this level, 71.39 becomes the next upside target from the move. Traders who are long might consider using a move below the previous days low as a stop loss indication.

Financials

Investec Ltd

The share price of Investec has been grinding higher and is heading towards range resistance. In so doing, the price has moved into overbought territory and started to form a bearish divergence with the stochastic indicator.

We have had a bearish price reversal form off the 135.15 resistance level. A move towards 131.44 and 128.54 is now favoured, while a close above the high at 136.43 could be used as a stop loss indication.

Sanlam

The share price of Sanlam is currently forming a bullish price reversal off trend line support and out of oversold territory.

Should the reversal confirm with a positive close on today’s candle, a move back towards 105.30 is favoured. Traders who find long entry might consider using a close below the 97.74 level as a stop loss indication.

Resources

Glencore

The share price of Glencore has formed a bullish price reversal off gap and trend line support. The reversal suggest the long term uptrend is now resuming with 116.36 the initial upside target from the move. Traders who are long might consider using a close below the confluence of support at 100.85 as a stop loss indication.

The BHP Group

The share price of BHP has formed a bullish price reversal off trend line support. The reversal suggests a move towards the 585.21 and 599.07 resistance levels. Traders who find long entry might consider using a close below 549.28 as a stop loss indication.

Harmony Gold

Harmony Gold has formed another bullish price reversal off support at 316.86. Gap resistance at 386.56 provides the initial upside resistance target, while a close below 316.86 would suggest the setup to have failed.

There is heightened volatility in the resource space at present, so smaller position sizes and extra caution is advised.

Sibanye Stillwater

The share price of Sibanye has recently reversed off long term trend line support, suggesting that the uptrend is now resuming with gap resistance at 77.05 providing the initial upside target from the move. Traders who are long might consider using a move below the 58.77 level as a stop loss indication.

There is heightened volatility in the resource space at present, so smaller position sizes and extra caution is advised.

Industrials

Aspen

The share price of Aspen has completed its first pullback from recent highs. We had a false break of gap support at 108.05 before a sharp price reversal ensued. The reversal is accompanied by a cross out of oversold territory. A move back towards 117.58 is favoured. Should the price instead move to close below the low 104.63, the setup would be deemed to have failed.

Bid Corp

The share price of Bid Corp could be in the early stages of a longer-term trend reversal. We are currently seeing the first pullback from the trend line break, and hope to see it settle above the trend line on the chart above.

Should we get a bullish price reversal before trend line support (previous resistance) is reached, traders might target a move back towards the 432.59 and 450.24 levels, using a close below the 400.41 level as a stop loss indication.

Telkom

The share price of Telkom has produced its first pullback from recent highs. The pullback has found support and now started to reverse off the 55.49 level. A move towards 61.83 is favoured. Traders who are long might consider using a close below the 55.49 level as a stop loss indication.

Retail