The JSE Top40 is looking weary, I am looking at this as a setting up of a topping formation for the weekly cycle for the following reasons:
1. RSI has begun falling, building negative divergence while price is still ranging in what appears to be some distribution.
2. In recent times, the Top40 has not managed above 20% distance from 200DMA, best being out of October 2020 low +21%, we managed 19% currently.
3. The uptrend has been on for 21 weeks, unless we have a long cycle, we within time for a top before going down for +10 weeks.
In this environment, one is best taking profit & seek shelter in shares that move contrary to the index. Price interaction with the green and blue trendlines will be of interest for the daily cycle going into March 2023.
1. RSI has begun falling, building negative divergence while price is still ranging in what appears to be some distribution.
2. In recent times, the Top40 has not managed above 20% distance from 200DMA, best being out of October 2020 low +21%, we managed 19% currently.
3. The uptrend has been on for 21 weeks, unless we have a long cycle, we within time for a top before going down for +10 weeks.
In this environment, one is best taking profit & seek shelter in shares that move contrary to the index. Price interaction with the green and blue trendlines will be of interest for the daily cycle going into March 2023.
Note
JSE Top40 fell out of the channel formed by upper pink resistance and blue support, the share then moved up in backtest fashion & was rejected on attempt to re-enter channel, this should cause downtrend to resume.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.