Global Safe-Haven Index (SHIX) | Our custom basket of safe-haven assets continues to trend lower, with the price as per the weekly chart below the 40-week exponential moving average. While the price trend does remain down, the basket has found two consecutive weeks of support at the demand/supply zone which is also in line with the 50% Fibonacci Retracement.
US Dollar Index (DXY) | Following the breakout of the double bottom technical formation, the index has back-tested the breakout level and continued to move moderately higher. We also note the price now firmly above it’s 21 and 50-day exponential moving averages, both of which have started to turn up. The daily RSI is in a bullish regime, with a 60 print, while the MACD Signal and Level lines are above the centre line.
US Dollar/Chinese Yuan (USDCNY) | A Continued Caution on Commodities | The Chinese Yuan appears ready to weaken following it’s year-to-date consolidation phase. A review of the chart of USDCNY notes the price recently regaining it’s 21/50-day EMA, both of which has started to turn slow their downward momentum while making a small turn higher. Also note the MACD crossing back into a bullish regime, while the RSI is 57 and trending higher. Ref: https://www.unum.co.za/research-base-metals-reversing-its-gains-along-with-the-chinese-yuan/
JSE Platinum and Precious Metals Index (J153) | The sector is higher by 827% from it’s June 2018 lows and currently trading at the breakdown level of July 2008. From an equity portfolio perspective, buy/long entries do not meet the appropriate reward-to-risk criteria. While the constituents have report stellar earnings, it may be appropriate to wait for a retracement for a new long entry.
As an example, in JSE Gold Miners index was 640% above it’s August 2018 peak before retracing by close to 50%:
JSE SMID Caps vs Large Caps | On a relative basis, small and mid-cap shares continue to rebound off their multi-year low vs large caps. So far this month we have seen the price hold above the pivot in place since April. A break above 2.02 would see the ratio breach a key resistance level.