Traders will also note that the South Africa 40 Cash Index is expected to adjust for a dividend in the underlying this week.
South Africa 40 Cash Index
Source: IG charts
The breakout scenario highlighted in our previous note resulted in a quick move through the 67580-resistance target. Circled red we see the move higher found a near term top in the form of a bearish price reversal (bearish engulfing pattern).
The price now trades within a near term range between levels 66450 (support) and 67580 (resistance).
We are currently waiting for a new directional confirmation in the form of a break of either support or resistance of this range. When one of these breakout scenarios manifest, we will update guidance accordingly with suggested stops and targets.
Cash adjustment expected
Traders will note that the South Africa 40 Cash Index is expected to adjust for a dividend in the underlying this week (Tuesday 17 October) currently estimated at 62.8 points.
Upcoming economic data
South Africa 40 Cash Index (previous)
Source: IG charts
The South Africa 40 Cash Index has now produced a close above the 66450-resistance level, and red trend line on our chart, confirming the upside breakout scenario from our previous note (below).
The move suggests an extension of the reversal off support (circled green) and from oversold territory. 67580 provides the initial upside resistance target from the move. The previously guided stop consideration of 65650 is now moved to a close below the 66450-support level.
Cash adjustment expected
Traders will note that the South Africa 40 Cash Index is expected to adjust for a dividend in the underlying this week (Tuesday 10 October) currently estimated at 136.3 points.