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  • Writer's picturePeet Serfontein

Analyst Thoughts - Top 40 Medium-Term


  • The PQ declining channel pattern is developing, which is bearish in nature.

  • However, the index remains above key support (see the dotted black trendline through the bottoms.)

  • The long-term trend remains bearish as well as the index is trading below its 200-day simple moving average.

  • Alternative 1: The price action might break below 65 900 and will trigger further downside potential. The price action might re-test the lower range of the declining channel pattern as 60 900, from where corrective waves 1, 2, 3 etc will unfold.

  • Alternative 2: The price action might re-test the key support around 65 900 and bounce back to its 200-day simple moving average and initiate the breakup out of the declining channel. Re-testing the break-out level might trigger the corrective wave 3.

Target and Re-assessment levels:

Important Level/s: 65 900 and 71 750.

Primary Trend: downside to 65 900.

Prevailing Trend: 65 900 to 71 750 ranging

Monthly Range: 60 900 to 67 940.

Technical Rating: Medium, with some alternative outcomes.


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