Thin trade expected for the last of 2010

It's amazing to see our market only 1300 points from its pre-crisis levels.

The European markets have opened positive and it looks like tension in the East have calmed down for now. The Asian markets have also reacted positively with most of them ending in the green.

Portugal's credit rating has been put under review by Moody's, but the market has not reacted adversely to it. It's almost as if the market is expecting these downgrades.

The US markets points to a positive open as well as their future indexes are up by about 0.5%.

There is not any significant news scheduled for this week, except for Thursday when unemployment claims will be published.

During the recent months we've seen a turnaround in the US unemployment figures and positive sentiment among consumers. We can also see it in their spending.

It looks like the recovery as under way with companies posting strong results.

Volumes on the markets are very subdued to it being close to Christmas.

Safe trading and a blessed festive season

Markets to continue its rally to the end of the year?

By the looks of it, it looks like the market is going to continue its upward trend. At least up until the end of December 2010.

After weak employment figures out of the US on Friday, the Dollar weakened against the Euro and the next target would be $1.37 and after that $1.40.

As we've reiterated in the recent weeks, is that commodity prices tend to rise as the dollar weakens.

The JSE is up 0.2% although Billiton, which is one of the commodity heavyweights, is up 2.5%.

Gold is also at record high levels and copper as well.

Banks remain on the back foot at the moment.

The ALSI future has also made a new 2 year high today and is currently tradin gat 28460.

Trade in December is usually thin and the feel good mood tend to influence investors/traders to buy the market up.

Safe trading

Dollar strengthening against the Euro on Ireland news

The greenback has strengthened against the Euro and is currently trading around $1.3165.

The JSE opened in positive territory, but has just turned negative and is down 0.10%. Markets are looking ahead for the next victim to be bailed out and it looks like Portugal or Hungary could be next.

Market volume should return to normal levels as traders return to their desks after the Thanksgiving weekend.

Anglo American is down 1.18% and the ZAR is currently trading at R7.13 against the dollar. This weakening in the Rand looks to continue as long as the US Dollar gains against the Euro. The next technical level on the ZAR is R7.20/$.

Safe trading

Markets follow the Euro lower

The Euro keeps on losing ground against the dollar, which is negative for stock markets.

The FTSE 100 is down 1.3% and US Futures also point to a negative start. The US markets are only open for half a trading session today due to Thanksgiving weekend.

Our market is down 0.78% and is trading at 31056 at the moment. Volume is below average due to the US markets shortened trading hours.

The market is trending lower, but in an orderly manner at the moment. We are down about 2.5 from the high of 31859 on Monday the 15th of November. Hopefully we'll see volume coming back into the market on Monday.

Safe trading

Thanksgiving holiday in the USA

Today is Thanksgiving holiday in the U.S and for those who don’t know what Thanksgiving is -Thanksgiving or Thanksgiving Day, is celebrated on the fourth Thursday in November, and has been an annual tradition in the United States since 1863, when during the Civil War, President Abraham Lincoln proclaimed a national day of thanksgiving to be celebrated on Thursday, November 26.

The event that Americans commonly call the "First Thanksgiving" was celebrated to give thanks to God for helping the Pilgrims of Plymouth Colony survive their first brutal winter in New England (courtesy of Wikipedia).

The domino effect

Global markets are getting more nervous.

The recent debt crisis in the European zone has sent jitters through global markets and brought volatility back into the markets.

Ireland's bailout details has not yet been finalised and already rumours about Portugal's debt problems are being spread. Portugal need to shrink their deficit from 9.4% to 7.3% this year.

It also looks like Greece is struggling to get their debt under control. But the big fish in the pond is definitely Spain. Spain is the fourth largest economy in the European Union.

If, and this is a big if, Spain needs to be bailed out. Is it too big to get bailed out or is it too big to fail?

The markets are quite stable today, with the US looking to open positive this afternoon after yesterdays' sell off.

Tomorrow is a banking holiday in the US, so we expect markets to be more volatile due to low trading volume.

Safe trading

Bailout for Ireland

Since the uncertainty was expelled confirming a bailout for Ireland, the Euro has reversed its downward trend against the US Dollar.

Foreign indexes have reacted positively to the news and the JSE ALSH is up 0.54% this morning at 31567.

The lowering of our interest rate is usually a boon for retail stocks. Also the holiday season lies ahead which could also give them a boost.

Safe trading

Repo rate cut by 50 basis points

It is all about the US Dollar

Fears that Ireland would default on its debt have sparked a sell off in world markets during the past week.

The correlation between the EURUSD and market direction is very strong.

When Ireland accepts assistance in the form of loans or a bailout, expect the Dollar to weaken again which should send commodity prices soaring. Our market is commodity driven, so expect the JSE to rally.

Local retail statistics released yesterday was positive, but could be a deterrent for the Monetary Policy Committee to lower the repo rate today. The decision will be broadcast at 15:00 local time.

Lower interest rates would favour retail stocks and one could see cash flowing to the equity market looking for yield. ZAR should weaken if the market reacts rational to a lowering in repo rate, but let us see what the decision is.

Safe trading

Heading for a fall?

Debt fears out of Eastern Europe have sparked a sell off in the Euro, and it looks like the markets are following suit.

The Euro is currently trading at $1.36 which is down about 4.5% from a high just above $1.42.

Our market is down 1% at the moment with the FTSE100 down over 2%. The American futures are also down around 1.5%.

One must remember that we're still in a bull market, and that if there is a reversal it will be sudden, since the downard trend has not yet established itself.

Safe trading.

The second gold rush

With the announcement coming from the US Federal Reserve last week that they would print a further $600 billion in order to acquire longer tern Treasury securities, alternative options such as gold are trading at new highs in dollar terms.

The new injection of US billions is in addition to bringing interest rates to nearly 0% and purchasing more than a $ trillion dollars of Treasury Securities and US backed mortgage securities.

The dual mandate of the US Federal Reserve is to promote a high level of employment and low, stable inflation.

Gold is a safe haven asset and in times of uncertainty, ultra low interest rates, demand has continued to push the price up.

The last real bull run was in the 1970’s when gold started the decade at around $35/oz and peaked at over $850 in early 1980. Most of the price appreciation occurred in the last 2 years of this bull market as the price moved up sharply from $200 at the beginning of 1979 to the $850/oz just over a year later.

The chart below superimposes that rally with the current price starting in 2001, producing one view of the possible further upside for the yellow metal.

Source: Sarasin, Ned Davis September 2010

Be long, but dance close to the door

Last night we saw the US Federal Reserve announce $600 bn in additional stimulus plus renewing the current stimulus of between $250bn-$300bn.

What does this mean for the markets? Well, cheap money is going to flow into stock markets and push prices higher looking for yield.

As you can see from the graph above, the JSE Allshare has made a turnaround from its last dip, and have continued it's rally upwards.

With the US dollar continuing to trade weaker, we can see commodity prices going upwards in anticipation when inflation kicks in. Thus it will be a boon for commodity related stocks.

Safe trading

Priced to perfection

This is the ALSI futures end of day graph.

It's looking to break to the downside and and looks to run out of momentum.

A break downwards will confirm our view, and a close/trading below 27 000 could confirm the trend.

Safe trading

A positive day ahead

By the looks of things to come today, it looks like an up day around the world with positive news from the G20 Summit regarding the currency situation.

The G20 countries have all agreed that they will not weaken their currencies to help boost their income from exports.

The ALSH has crossed over on the moving averages and looks to be struggling to keep the upwards momentum intact.

Shares showing weakness are Cadiz, Standard Bank, Old Mutual, ABSA, Lonmin, Amplats, and Wesizwe.

Shares giving a heads up are Firstrand, Illovo, Remgro and Vodacom, with Pick n Pay looking to extend gains to the upside.

To find out more about increasing the probability on making profits with the use of technical analysis, give us a call.

Safe trading

Markets peaking out.

The JSE contintued its rally from yesterday's close as we're up 197 points.

Volatility is starting to show since we've had fairly good days with the market moving down on Tuesday, and bouncing back yesterday. In the end we are where we were on Monday...

Out of a technical perspective, the moving averages are starting to converge, but hasn't crossed yet. Some stocks showing weakness is MTN, Standard Bank, Old Mutual and Discovery.

Resource stocks are providing the momentum on the JSE at the moment, with the rand also trading between R6.98 -R6.90 to the dollar.

Stocks that's performing well are Reinet, BATS and Anglos and Billiton to name a few.

For a more detailed discussion, give us a call on 0861117625.

Look out for jobless claims later this afternoon out from the USA.

Safe trading.

Which way today?

The JSE closed down a 185 points (-0.61%) on Friday to close at 30066.

The US markets closed mixed with the DOW down, while the S&P 500 and the NASDAQ closing in positive territory.

The US futures are trading in the red at the moment with all the index futures down over 0.5%.

The price of Brent crude has also declined to 81.78$ per barrel from a high of 86$ per barrel last week.

A possible short could be SASOL, which is looking weak, but keep in mind the 770c dividend it divulged a week ago. But the trend is looking negative as its moving average indicators are on the way down.

Also Firstrand is starting to look weak, which could indicate some downside.

All signs at the moment indicate a lower open today.

Let's see how the markets open.

Safe trading

Markets continue their rally

The ALSI opened up this morning by about half a percent.

The Allshare Index traded at 30500 this morning which makes that a new high for 2010.

The US markets closed well up above 0.5% for the day yesterday and the futures also point to a positive start for the day.

Resource shares are the biggest gainers for the day with Exxaro leading the charge. The Euro overnight pierced the $1,40 level and is currently trading at $1,409, and gold at $1383.90, which is an all time high.

As long as the trend stays up, being long is the way to go. The dollar is also weaker against the Rand and is currently trading at R6.77/$.

As long as the US dollar weakens, we'll see strong markets.

Safe trading

JSE above 30 000!

This morning the JSE Allshare broke through the 30 000 level. To put this into perspective, at the height of the market before the 2008 crash, the Allshare was trading at 33 000. This is only 10% from here.

The strength of the markets is supported by a weak US Dollar and more quantitative easing measures from the US government to stimulate the US economy.

What this means is that the Federal Reserve will be pushing their printing presses to the limit to print more dollars. These dollars will find their way into the market, bypassing banks and eventually ending up in the stock market looking for yield.

As with any country printing more money while growth remains mediocre, inflation will follow, maybe not in the short term, but definitely over the long term. This is the main reason behind the gold rally.

The ALSI futures are currently trading at 27011 which is up 242 points or 0.9%.

Safe trading

Markets eyeing direction from abroad

Yesterday our market inched up another 28 points to close at 29295, falling back from an intraday high of 29411.

The US markets retreated last night by closing down almost 1% and the VIX spiking up 4.58%. US futures indicate an unchanged start to the day, but it's way too early to tell.

It looks like the market rally is losing steam, so be cautious in putting on new long positions. Take some profit from profitable trades and either wait for the market to break up again, or to pull back a little.

Our futures market is trading down 49 points since the open, and it looks like it can break down to the 26000 level today. The rand is trading steady just above R7/$. Any stocks with foreign exposure would benefit if the rand should weaken.

Safe trading

The hunt for Red October

As we suspected, the market pulled back on Friday after the end of quarter reporting period on the 30th of September 2010.

October is usually a very good month for stocks, and September usually not such a good month for stocks. But in this market, September was indeed a very good month closing 8% higher. So will we see a bit of a pullback in October?

As we can ascertain from the graph above, we're currently trading near the yearly high around the 29500 mark. From our stochastic indicator we deduce that the market is currently in overbought territory, and we need positive news to push us above the 29500 mark.

The markets are awaiting news out of the US on Friday when they deliver their unemployment rate for September, which could move the market significantly.

The current market direction is primarily dictated by the strength of the US Dollar. If it weakens, resource prices go up, i.e. copper, gold, silver, etc. If the US Fed decide to put more stimulus into the US economy, it could signal that the recovery is not as strong as it seems, and could influence the sentiment in the market.

It would be prudent to take some profit from your long positions and see if the current rally continues. Short positions are not advised as of yet, as the trend is still on the up.

Safe trading

Markets nearing 29500 level

If you thought that a week ago the markets were overbought, think again. We are nearing the previous 2010 high, and we can expect resistance at that level.

Today is the end of the quarter and also end of the reporting period for unit trusts and related funds. Around this time one should be on the lookout for "window dressing" by investors.

What happens is that a lot of buying action is seen so that fund performance will look good, only for investors selling their stock the day after to limit their exposure.

Jobless claims is out at 14:30 as well as the final quarterly GDP figure. Ben Bernanke will start his speech at 16:00, which usually also influences market sentiment and direction.

Expect volatility to rise pre 14:30.

Safe trading

Markets advance, nearing previous highs

Yesterday rally kept the upward trend intact. As long as this trend holds, there is no reason to sell your shares just yet.

This mornings' trade is quiet with markets in the green, if only by a little.

The Rand remains strong at R7,10/$. The outlook for the Rand remains bullish for the short term.

We expect the market to continue it's upward trend and to test the short term high of 28900.

Safe trading

Markets weaker on recovery concerns

The JSE All Share is down 0.42% so far today. We expect a bit of a pull back after the rally we've had the past two weeks.

The ALSI futures is also down 0.54% so far for the day. Gold made a new record high yesterday and the ZAR is trading at its best level in 3 years against the USD at around R7.08/US$.

There is no significant news expected today, with US unemployment claims released tomorrow afternoon.

With future close out tomorrow, heed caution in taking any new positions, since high volumes of trading is to be expected, although a lot of investors have already rolled or closed out their September 2010 contracts.

Safe trading

Markets moving into overbought territory

Due to the lack of negative news, the market has recovered nicely during the past 2 weeks.

As can be deducted from the graph above, the MACD and RSI indicators indicate that the market is trading in overbought territory.

News out today is the British GDP at 10:30 and out of the US their retail sales figures at 14:30. The market doesn't really react to negative news at the moment, since the momentum is quite strong to the upside and it would take something significant to sway sentiment amongst investors.

We can expect resistance around the 28800 level. A break through there would pave the way for a movement up to 29500. Although we think this is a bit optimistic.

Futures close out is on Thursday and we expect the market to be strong up until then at least.

Safe trading

Markets looking for direction

Looking at the chart of the JSE All Share this morning, it looks like the market wants to break up. I'll rather wait for the market to breach the 28000 level before going long.

The American futures are negative this morning in the region of -0.1%, but that could change quickly. The market is looking for some direction after the rally from last week, but at the moment news was thin the past few days.

The MPC will announce their decision on interest rates shortly after 15:00. The broad consensus in the market is that we'll see a 0.5% cut in the repo rate. A cut in the repo rate will affect the Rand, retail stocks, and stocks with foreign exposure like Richemont, Steinhoff and British American Tobacco.

At 14:30 the unemployment claims and US trade balance are released. We expect the market to trade range bound up until 14:00 after volatility and volume will start to rise.

Safe trading

Market to open down

The world markets are under slight pressure this morning and our futures market opened down 100 points. The mining tax in Australia, with the resurfacing of the banking issues in Europe does make investors nervous. We prefer to trade short at the moment and will keep an eye on some blue chips that is showing decent value.

Some of our current positions are
Pairs
Long Reinet, short BATS
Long Pikwik short PIK
Long ABSA short ABIL

Other
Short ALSI future
Long Gold and selected IT stocks

Safe trading
Your Rock Capital team

Up Up and away

After positive data out of the US yesterday, our market has reacted positively and is up 1.17% for the day so far.

Resource shares are leading the rally and therefore our market is pushing upwards sharply.

News that could influence the markets today is at 14:15 ADP Non-Farm Employment change and at 16:00 the ISM Manufacturing PMI.

From the above graph, it looks like our market has turned around and broken the downward trend.

Wait for the data out later today, before adding more to your long positions.

Safe trading

Market steady ahead of US housing figures

The JSE stocks rallied hard yesterday and was up by about 1.5% for the day. Keep in mind that the UK market was closed yesterday due to a bank holiday, and our total volumes traded on the JSE was a lot lower than normal.

The US markets opened up relatively unchanged and turned weaker to give back all the gains it made on Friday.

At 15:00 the S&P House price index releases its findings and an expected rise of 3.8% is expected. A disapointment from this figure could send the markets down up until 15:45 when the Chicago PMI figures are released, and then at 16:00 the consumer confidence figures are released.

Expect volatility to pick up just before these figures are released.

Keep positions small and wait for the trend to establish before executing your strategy. Being on the wrong side in this market can prove immensely expensive.

Safe trading

Possible reversal on the markets

On Friday our market paired its losses in the last hour of trading. The American markets also turned around after Fed Chairman Ben Bernanke assured investors that the Fed will do all in it's power to stabilise the economy. It then went on to rally up nicely and close above 1.5% for the day.

The UK has a bank holdiay today, so the FTSE is closed today. Volatility and low volumes can be expected.

It would be prudent to take profit on short positions. We've seen only a few stocks that gave us buy signals this morning, but if the markets continue to rise, more stocks would start giving us a heads up.

Safe trading

Nearing the 26 000 support level

As forecasted by our technical analysis yesterday the market came down 599 points (2.21%).

We are nearing the support level at 26 000 and we expect a bounce from there. But the newsflow about the global macro economic conditions doesn't look too good.

Unemployment claims from the US is out later this afternoon and tomorrow it's their GDP figures. All indications point to the news being negative, and we could just as well go below the 26 000 level.

If this crucial support level turns into a resistance level, we could see some panic selling around the world.

But the world is not coming to an end as we know it. (Only if you're long stocks)

Safe trading

Markets still weak

The market is continuing its downward trend today and we're down about 0.5% on the All Share Index.

Yesterday the numbers out of the US housing market dissapointed again with their existing home sales coming in much lower than expected.

BHP Billiton released results this morning. They doubled their net income, but dissapointed on top line earnings. Subsequently the market reaction was mixed, and it's trading unchanged from yesterdays' close at 20534c.

New home sales are released out of the US today, and if yesterdays' existing home sales figure is anything to go by, expect mediocre numbers.

This could influence the market to the downside, and we think that the market will continue its downward trend for the rest of the week, encountering support at 26 000.

Safe trading

The dead cat bounced 372 points

Our market has opened down about 1% this morning. Yesterdays' relief rally seems to have sucked in the bulls and will squeeze them today.

Our GDP figures are released today, and the consensus is that a slowdown is expected.

News out of the USA today is their existing home sales numbers to be released at 16:00. A weaker number is expected and we could see the downtrend on the North American markets to continue.

Safe trading

Market trading below the 200-day Moving average

After a negative week last week around the world, the JSE is trading below the 200-day moving average. This is a bearish signal for long term investors. Also taken into account the Hindenburgh Omen that occured on the 12th of August, sitting in cash or buying into defensive stocks would be a safe bet at the moment.

The head and shoulders formation is now fully formed and the right arm is forming, thus we expect the market to go down to 26 000 before encountering some support. The 26000 level is crucial since a break and close below 26 000 would turn this support level into resistance.

The Nedbank HSBC deal has gone public and Old Mutual's share price has soared 5% on the opening of the market.

Resource shares has received some support out of Australia. The proposed mining tax has been put on hold for now after the recent elections that have taken place.

We expect the market to trade down further today.

Safe trading

How high can a dead cat bounce?

Dead cat bounce is a Wall Street term that refers to a small, brief recovery in the price of a declining stock [Wikipedia]

Don't get sucked in with the rest of the bulls. As you can see from the JSE All Share graph above, there is no real support except at 26 000.

We expect a bit of a bounce in the market today, since there is no significant news coming out today.

If you are long, good luck, since that is the only thing that will be in your favour. At the moment being long in this market is like catching a falling piano...

Safe trading

Markets indecisive

The markets are indecisive this morning.

First we opened up by a 170 points, to fall by 300 points when the equity market opened at 09:00, and to reverse those losses to trade up again by another 220 points to where we are now.

The markets are eyeing unemployment claims released at 14:30 and the Philly Fed Manufacturing Index at 16:00,

Safe trading

Technical view: Market on its way down to 26 000

This is the JSE Allshare Index. This morning it was starting to form the second shoulder, and by the looks of it, it's testing the neckline at the moment.

As we can see from the graph, there is no resistance between where we are now and 26 000.

We will be monitoring our short trades that we've put on, adding when it's already in a tidy profit.

Safe trading.

Market trading down this morning

The ALSI opened fairly unchanged this morning but has since dropped over 1% and is trading at 24350 at the moment.

The above chart is the JSE Allshare Index that we posted on Monday for a potential head and shoulder pattern forming. As of this morning it looks that the forming of the right shoulder is almost complete.

Short term traders can look to short stocks or indexes here, except for gold related securities. If it breaks down, we expect it to reach the 26 000 level within the next 5 days.

Start small trades and add more weight if the trade is in your favour.

There is no significant news expected from abroad, but in SA we're expecting retail sales figures out later today.

Safe trading.

Market trading slightly higher this morning

The ALSI opened up 120 points this morning and is currently trading at 24580. There is some resistance at 24600. If it breaks out of 24600, we can see it trading significantly higher.

News that could influence the market today is the British CPI out at 10:00 and PPI and Building permits out of the US at 14:30. A low CPI figure could awaken deflationary fears.

Overall volume remains subdued and indicates uncertainty in the market.

Safe trading.

Technical perspective: Market looking to extend losses

This is the daily graph of the JSE Allshare Index.

There is a developing head and shoulder formation on the daily graph with the two cirlcles indicating the shoulders. The second shoulder is not yet fully formed, but be cautious.

A head and shoulder formation is not a 100% indication that the market will come down after the second shoulder have formed, but the probability is around 80%.

Also another technical analysis pattern, the Hindenburg Omen, is looking to develop.

The Hindenburg Omen is a technical analysis pattern that is said to portend a stock market crash. It is named after the Hindenburg disaster of May 6, 1937, during which the German zeppelin Hindenburg was destroyed. [Source: Wikipedia]

To read more about the Hindenburg Omen, click here http://en.wikipedia.org/wiki/Hindenburg_Omen

Volatility has continued its uptrend since going up from the 6th August 2010. Gold is also trading higher this morning at $1219 per ounce.

The Asian markets are trading higher this morning and the Dow Futures are positive by 0.13%. We expect the momentum of the relief rally to slow today or tomorrow before turning negative again, confirming the head and shoulders pattern.

Thus, we think there is currently more downside risk than upside risk.

Safe trading

We opened a short position at 24320 on the ALSI

We opened a short position on the ALSI at 24320.

We expect the market to trend down and will keep our stop loss levels tight. Especially around 14:30 when the news from the USA is released.

If the news is bad, we'll add more weight to an already profitable trade, but never add to a losing trade.

Ride your winners and cut your losing positions so that you have enough bullets when you get a trading signal.

Safe trading

Markets taking a deep breath

The ALSI opened up around 200 points this morning, but it's consolidating at the moment around the 24340 level.

Yesterday and today looks like a bit of a relief rally, and we are expecting inflation and retail sales figures from the US later this afternoon, which could influence the market.

Since volatility is still on the uptrend, we are cautious regarding opening new positions. For now we've taken profit on our short positions and we are either in cash or hedged.

GDP figures from Europe was in line with expectations with Germany leading growth at 2.2% for the second quarter, but Spain only expanding by 0.2%.

The new topic on the newswires is that America would probably lose the AAA credit rating in the next 3-5 years, but that's merely opinion and not a imminent risk.

Safe trading

Markets continue going South

The market is continuing its downward direction and is following the markets from the rest of the world.

The market will probably test the 26000 level on the ALSH again, which is a 1500 points (-5.5%) from here.

We expect a relief rally in the next day or two, before the market continues its current trend. Volatility has spiked 13% since yesterday as well.

Safe trading

The trend has broken

The ALSI opened down 140 points this morning from yesterdays' close. It has regained some of these losses, but the general trend is still to the downside.

The graph above is the daily graph of the JSE All Share index. Clearly one can see that the uptrend has ceased.

The Dow Futures are down 0.77% at the moment and is look to continue its downward movement after Fed Chairman, Ben Bernanke, gave their view on the economy last night.

Asian markets are also down, with the Nikkei 225 -2.47%.

The pullback we wrote about last week has started.

Safe trading

Market trading down

We've opened our 2nd short trade on the ALSI with our stop at 24980.

At the moment the market is not coming down aggressively. It's rather coming down in a sneaky fashion, slowly but surely, building on negative momentum.

The strategy to follow here is to go short, but with a very small trade, wait until it's profitable, and add some more to the short. By the looks of things, we're not going to wait very long.


Safe trading

Markets are getting nervous

The market is not looking well this morning. The ALSI is currently down 100 points or 0.4%.

We've also seen a lot of short/sell signals on shares in the TOP40. The only buy signal we've seen this morning so far has been in gold related shares.

The market has been trading down and has broken the trend on Friday as can be seen from the chart below.

The prudent thing to do is to take profit on your positions, and probably start putting short trades on.Safe trading

ALSI volatile, but trending upwards

The ALSI trade this morning has been choppy, with up and down swings, but the general trend remains up. For the past week we've been trading sideways in a 200 point range between 25400 and 25600, with support and resistance at both these levels.

A breakout through either of these levels could give some market direction.

The US unemployment rate figures are released at 14:30 this afternoon, and we expect the market to trade sideways until then.

Old Mutual posted good results this morning and is trading up 3% at 1469c.

Safe trading

Jobless claims dissapoint

Jobless claims out of the US was up by 19 000 claims, at 479 000 instead of an expected drop of a 1000 claims less.

The market has been trading down since the figures was released by about 70 points.

Market in choppy territory

As you can see from the graph, trading has been quite choppy today. Uncertainty is affecting the market, and we'll have more clarity at 14:30 when the Unemployment claims from the US is released.

The expected number of claims is 456 000, which is lower than the previous periods' 457 000 claims. Any large deviation will dictate the market direction.

Safe trading

ASLI trading lower again

We closed our ALSI trade yesterday with a tidy profit of 170 points per contract. 1 point equals R10.

The ALSI opened up 100 points from yesterdays' close, but have turned around and are only up 10 points at the opening of the equity market.

The market is looking a bit tired and volatility remains low. So it is still trending downwards slowly. If volatility picks up, bigger movements is expected.

Unemployment claims from the US is out later this afternoon, and could have a pivotal effect on market direction.

Safe trading

We moved our stop loss down a 100 points below entry

We moved our stop loss down a 100 points below our entry to lock in profit according to the free trade principle. If the trade continues to go in our favour, we will move down the stop loss to ensure that we don't give back all the profits, if the market decide to move against us.

Safe trading,

Market trading down this morning

The market opened slighty down this morning and is currently trading -115 points (-0.45%).

After the run we had last month, we're expecting a bit of a pullback, and keeping our eye on volatility. If the markets trend lower with volatility remaining stable, we expect a mild pullback.

Gold have also started rising since Friday, and as we can ascertain from the chart below, it has broken the trend to the downside. Possible reasons for the rise of gold could be the depreciation of the USD and cautiousness on the side of investors due to the safe haven status of gold.

Safe trading