SA40 index: Beyond all-time highs?

The South Africa 40 index has broken out of the identified flag pattern and traded through its all-time high resistance as anticipated in our analysis in last week's newsletter.

A flag pattern is a well-known continuation pattern in technical analysis. It currently playing out accordingly as we see that the preceding trend is resuming, following a consolidation. 

The 38950 level is the proportionate target projected from the flag formation as we move into new territory.

The previous resistance levels at 37700 and 37500 now become our anticipated support levels should the price pull back before attempting a move towards the projected target. 

If we see the price retrace below our support levels, these considerations would be deemed to have failed for the time being.



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