The South Africa 40 cash Index has moved closer to last week’s projected target (44000) from the double bottom reversal pattern (blue “W”). The 44000 levels remains the favoured target although initial resistance is considered at 43750 (recent turning point).
Should the price manage to close above the 43750 level a larger reversal pattern in the form of an inverse head and shoulders (labelled L, H &R) becomes relevant.
Should this occur the pattern would predict significant upside (more than 2000 points). Failure of both the double bottom and possible inverse head and shoulders formations would be considered should the price close below the 42150 level (or 42640 on a line graph).