Trader call it volatile, I call it explosive – Reponse
I would like to respectfully point out some flaws in your analysis of the current market conditions. Having been left amused after reading your article yesterday, a couple of statements stood out showing how little knowledge of market dynamics you possess.
As an investment and risk specialist the following statements makes absolutely no sense and show your perspective towards the market and not the actual nature of the market place. 1) “losses of this week defies logic” 2) “many investment decisions are largely driven by narratives and not by analysis or common sense”.
Any market specialist will know both these assumptions to be false. The majority of volume is controlled by managers tending funds of pensioners,swf etc and trust me these people take their job seriously.
These losses that seem to baffle you are what Ralph Elliot termed as waves. Secondly the article by Mr Friedrich(certified financial planner) suggested the rand is “unjustifiably weak” and “fundamentals remains strong”. According to the dow theory the market discounts everything and at any given time prices in all information,past,present future.
Secondly he seems to overlook the unwinding of q.e,raising of U.S interest rates and the fact that the American economy is performing much better than the South African one. South Africa individually has social structural problems that cant be dealt with without greatly affecting the economic processes of South Africa.
These are things us traders/ investors look at while your work in informing the public is honorable(not so honourable when the information is flawed) and is your mandate as journalists, kindly consult with individuals who actually have skin in the game and commit their time to understanding the market and not reporting on it.
(Response published verbatim – Ed.)