ALSI 40 and 400 points today!

ALSI 40 with 400 points today! Absolutely fantastic!

The market was look overbought since yesterday. It proved to be a call worth waiting for. The gap on the open of thursday last week was an exhaustive gap meaning that the move was losing momentum.

The 60 min and 15 min chart were saying the same thing from early this morning at 9h45 you should've been short from around 18030 and should still be short. for just over 400 pts right now. The low for the ALSI 40 today was 17490...

The end of day chart shows the 18200 level was the major resistance and that we could expect a number of days to the downside to follow. The trade short could be open until the end of the week even. It would need to be monitored of course.

One should've added to theposition at around 17710 to the short in order to gain from continued downside for the after session. This would have created an additional 200 pts for you on the second position which should be closed now to secure profits.

With the RESI and Findi both taking a hammering it was a matter of time before the ALSi top 40 gave way to the negative movement. Remember the Alsi Top 40 is made up of financials and resources shares in the main. If both take a pounding then you can be sure the ALSI will follow.

The market outlook for the rest of the week is quite negative. The futures close out happens on Thursday which forces all short sellers to buy back their shares. One can roll over to the June contract but this incurs a small amount of costs of 0.25% of the exposed position.

Generally, if you are taking any trades between now and Thursday be sure to ask for the June contract. Also NOTE: there is articificial buying pressure in our market currently due to the closing of short positions.

The same can occur at the end of the month when the Unit Trusts all close their books for quarterly reports. They tend to push the shares up in the last week of the quarter to improve their quarterly performance. Be aware of this too.

We also looked to short Anglogold and Anglo American and Standarad Bank today which have all gone smooth in the negative sentiment on the day!

Do you want to learn how to make money when the share prices are dropping? It's called shorting! Learn how you can make money in bad markets!

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