What we are currently seeing on the JSE is certainly out of the ordinary. It is a rare thing for record highs to be met with such a lack of enthusiasm. Investors have benefitted from an incredible bull run over the last six years, but there is a very palpable underlying nervousness about where this is going. With every gain that the market makes, the feeling grows that it is moving towards the edge of a cliff. At current valuations and with a number of technical measures pointing to a market that looks overbought, some sort of a pullback appears to be lurking. Gavin Wood says that investors are right to be cautious, particularly given the manner in which the JSE has made its gains.
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