1,2,3 bounces and up it goes!
You can clearly see in the daily chart (JSE-ALSH), that the JSE has been making higher lows from October 2014.
· On the 16th
of October, the JSE made a low of 40,925.
· On the 17th
December 2014, the JSE made a higher low of 41,271.
· On the 14th
January 2015, the JSE made an even high low of 41,815.
So you can clearly see that it’s been on a gradual uptrend. And so it’s best to follow the direction than go against it…
If you see greenery, you got to get in and ride the JSE wave up!
The next thing I was looking at was the price action of the candles (colour and size of the green candles).
Before I continue you must remember, green candles mean people are buying.
And for the first time in over a year, you’ve seen green candles one after another after another, which should tell you that demand is on the up.
Take a look at the chart so you can see for yourself
When you see green, people buy! And when you see red, people are selling…
If you look at the candles in the oval, you’ll see that there are 8 rather large green (buying) candles…
And only two red (selling) candles…
These are the kinds of things I look at to help me see where the JSE is more likely to go…
And because there are 8 green candles in less than one month, tells me that the momentum of the JSE is ready to rocket to 48,000!
Here’s how you can take full advantage and bank 96.70% from the move!
If you want to take profit from the rise, then you’ll need to trade using the ALMI.
The ALMI is a financial instrument that is the smaller and cheaper version of the ALSI future contract. Instead of paying R30,994 for the full contract, you’ll only pay 1/10th
of the price (R3,100) for one ALMI contract.
Which is damn good price!
All you need to know is that for every 1% the ALSI 40 rises, and you go long (buy), you’ll make 15% - 15 times geared.
So, if the ALSI 40 rises from 45,002 to the expected level 48,000 (6.6%) you’ll bank a fantastic 96.70% gain, by going long the ALMI.
Not a bad gain while everything else is in turmoil!
Senior Editor, Trading Tips