Something new .... Budget speech made Rand weaken

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Derek  26 Oct 2018

Good Morning,

Asian stocks lost $5 trillion so far this year with no end in sight? All the indices in the US made a green bar inside the previous day's big red candle. All that this tells us is that the bulls and the bears are now in a state of truse. The high and low of the previous day were not broken.

Notice the unconfirmed divergence in place for the S&P500. The EMA8 and trend lines are not threatened yet? Nor has FrontRunner broke its moving average. So, some more wait and see?

The HangSeng made a gap the previous day. Exhaustion gap? Also notice the divergence in place.

Now for something new not mentioned before. When one is getting such a strong correction (crash?), many shares correct in 3 trend line phases. If you can visualise it, it is the shape of a right top quarter elipse.
I show this for Analog devices and notice that it closed with a Harami candle pattern.

You can see the shape even better on my old favourite: Bank of America. No share escaped the correction, not even Amazon with its record profit.

JSE Technical:
a Budget speech that only highlighted all the problems, that we already know of, and avoiding giving details of solutions made the Rand weaken. Notice that it all happened on my long term weakening trend line.

High volatility on support usually marks a turning point. Notice the volatility of RMB Holdings for 2 weeks and then the break came. During the 2 weeks we had divergence in place and even the lagging MACD broke up! All signs that something must happen.

All the signals are pointing to a turn, but best to wait for confirmation. The previous days high must at least be broken with some signals confirming.

You must have a great weekend.
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