US midterm elections outcome vital for markets .... Profit taking

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Derek  7 Nov 2018

Good Morning,

The outcome of the US midterm elections are vital for next market movements.

The East is responding positively this morning.

The S&P500 is continuing with its positive move ahead of the election results.

Xerox Corp is just continuing its strong trend. Remember that cyclic signals must be ignored when a share is in such a strong trend until trend line gets broken.

Technology shares reached support and Advance Micro Devices wants to close its exhaustion gap now. Although this share corrected viciously with the last correction, it still has the strongest trend factor in the S&P500.

JSE Technical:
Some profit taking took place on the JSE where shares are in overbought territory.

After its recent run, Clicks is one of the shares that was heavily overbought. Notice the colour of the 2 heatmaps.

Since the Steinhoff crisis, PSG broke down and the previous support became resistance. It then started moving sideways between 2 resistance lines. We are again in overbought territory against this resistance. I had to zoom out quite a bit to show all this. I hope you can see the doji against resistance.

Enjoy your day and lets hope the election results favour the markets. There is a prediction of a 15% market move either way in the US, depending the outcome of the elections.
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