JSE Top 40 (J200/JTOPI) Losing Steam?
Is the JSE Top 40 Index running out of steam?
Purely technically, has the JSE reached its top? I think we are nearing it
Strong parallel channel plotted with resistance at around 73,000 and support at around 70,000 points. Price has broken the resistance and we expect a reversal to support at around 70,000, however, we are targeting lower levels for a short.
Look at going short at around 73,000 - 73,300
Set Stop Loss ("SL") at 75,000
Take Profit 1: 69,000 (if 70,000 support breaks)
Take Profit 2: 67,000
Take Profit 3: 58,500
Take Profit 4: 44,000
Given the current macroeconomic climate, we see central banks being hawkish as an early recession indicator and a market top with a bearish bias for us
We are waiting for a 20% correction at minimum within the next 6-12 months and will hold the trade longer. 44,000 points is an extreme long-term price target which could be influenced by the Covid price correction outlier, but still relevant over the long-term
Payoff Profiles:
Initial Margin Required per Contract = R9535.50
Capital Buffer Required (30%) = R2860.65
Total Capital Required per Contract = R12,396.15
Expected Profits
TP 1: (73,000 - 69,000)* 1 = R4,000 Total Capital Return = 32%
TP 2: (73,000 - 67,000) *1 = R6,000 Total Capital Return = 48%
TP 3: (73,000 - 58,500) *1 = R14,500 Total Capital Return = 117%
TP 4: (73,000 - 44,000) *1 = R29,000 Total Capital Return = 234%
SL: (73,000 - 75,000) * 1 = R2,000 Total Capital Return = -16%
Worst Case R/R = 2:1
Best Case R/R = 14.6:1
Realistic R/R = 3:1
#IAMTHESPEQL8R #LIONTRADE
Disclaimer: The aforementioned trade analysis and idea is purely for educational purposes and is not financial advice. The author and publisher of this idea cannot be held liable for any profits or losses incurred if this trade is executed by the individual. By executing trades on this position, the individual acknowledges that their capital is at risk and that they knowingly and intentionally executed this trade. Although the author is a licensed trader and registered person, this post does not constitute financial advice and there is no intent to solicit sales of any sort from individuals reading this post for educational purposes
https://www.tradingview.com/chart/?symbol=JSE%3AJ200
Purely technically, has the JSE reached its top? I think we are nearing it
Strong parallel channel plotted with resistance at around 73,000 and support at around 70,000 points. Price has broken the resistance and we expect a reversal to support at around 70,000, however, we are targeting lower levels for a short.
Look at going short at around 73,000 - 73,300
Set Stop Loss ("SL") at 75,000
Take Profit 1: 69,000 (if 70,000 support breaks)
Take Profit 2: 67,000
Take Profit 3: 58,500
Take Profit 4: 44,000
Given the current macroeconomic climate, we see central banks being hawkish as an early recession indicator and a market top with a bearish bias for us
We are waiting for a 20% correction at minimum within the next 6-12 months and will hold the trade longer. 44,000 points is an extreme long-term price target which could be influenced by the Covid price correction outlier, but still relevant over the long-term
Payoff Profiles:
Initial Margin Required per Contract = R9535.50
Capital Buffer Required (30%) = R2860.65
Total Capital Required per Contract = R12,396.15
Expected Profits
TP 1: (73,000 - 69,000)* 1 = R4,000 Total Capital Return = 32%
TP 2: (73,000 - 67,000) *1 = R6,000 Total Capital Return = 48%
TP 3: (73,000 - 58,500) *1 = R14,500 Total Capital Return = 117%
TP 4: (73,000 - 44,000) *1 = R29,000 Total Capital Return = 234%
SL: (73,000 - 75,000) * 1 = R2,000 Total Capital Return = -16%
Worst Case R/R = 2:1
Best Case R/R = 14.6:1
Realistic R/R = 3:1
#IAMTHESPEQL8R #LIONTRADE
Disclaimer: The aforementioned trade analysis and idea is purely for educational purposes and is not financial advice. The author and publisher of this idea cannot be held liable for any profits or losses incurred if this trade is executed by the individual. By executing trades on this position, the individual acknowledges that their capital is at risk and that they knowingly and intentionally executed this trade. Although the author is a licensed trader and registered person, this post does not constitute financial advice and there is no intent to solicit sales of any sort from individuals reading this post for educational purposes
https://www.tradingview.com/chart/?symbol=JSE%3AJ200
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