Sell off world wide! .... Did politics play a role or ....

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Derek  30 Jan 2018

Morning,

Not the news you want to hear this morning, but it was not only the JSE that experienced a sell off yesterday, but all markets world wide. Asia is also following the negative trend of the US this morning.

International:
The Nikkei is the one index that has already been 4 days below the EMA8 line. Notice the divergence and where MACD broke down.



CBOE Holdings is one of the best trending stocks in the S&P500. Notice where the TrendFactor changed from light green to dark green. I show the divergence that can be seen with FrontRunner. Frontrunner is one of the best divergence indicators you will find. The RSI, that most people use, showed no divergence. Do notice that the EMA8 line is not broken yet for this strong trending share.



JSE Technical:
Did politics play a role in the JSE sell off, or were the shares just overbought, or are we just following world markets, or is it a combination of all? Decide for yourself, but it has been a long time since I have seen so many double tops. That, together with divergence, send a sell quiver through my veins.

Notice the double top and divergence at Sanlam. EMA8 and trend lines broken. The trick is not be greedy, but to take profit as you get a double top.



Dis-Chem Pharmacies made a tripple top. This time the RSI also gave divergence. Notice the HeatMaps before the correction.



Most of the shares also made a long leg doji's before the correction, so in my book, everything was just overbought and the technical indicators were there. The only one that bit me was Capitec. But even Capitec showed the Engulfing bull the previous day. Look at the graphs of the following shares to see what I am talking about: BAW, REM, DCP, FSR, RMH, SLM, OML, CML, SBK, PSG.

Enjoy you day and remember: Greed and Fear drives the market!

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