South Africa’s $12B LNG Deal Fuels JSE Top 40 Rebound, Key Levels to Watch

South Africa’s JSE Top 40 Index (T40SA) is showing resilience, hovering near ZAR 85,883.9, following a minor pullback from recent highs...

Arslan Butt•Tuesday, May 27, 2025•2 min read

Quick overview

South Africa's JSE Top 40 Index is currently at ZAR 85,883.9, showing resilience after a minor pullback from recent highs.
A landmark $12 billion LNG trade deal with the U.S. and potential interest rate cuts by the SARB are boosting market optimism.
Technical analysis indicates a healthy consolidation phase, with key support at ZAR 85,550 and resistance at ZAR 86,611.7.
Traders should watch for bullish confirmation near support levels to gauge the next market move.

South Africa’s JSE Top 40 Index (T40SA) is showing resilience, hovering near ZAR 85,883.9, following a minor pullback from recent highs of ZAR 86,611.7. This comes amid rising optimism fueled by a landmark $12 billion liquefied natural gas (LNG) trade deal with the U.S. and speculation that the South African Reserve Bank (SARB) will trim interest rates. The index’s price action signals a healthy consolidation phase within a rising channel, characterized by higher lows and parallel trendlines.

Candlestick patterns, including spinning tops and doji formations, suggest indecision after a bullish push. However, the channel’s structure points to an intact medium-term uptrend. The MACD indicator, showing a brewing bearish crossover, flags a potential for deeper retracement if momentum weakens. Key support sits at ZAR 85,550 near the channel’s lower boundary, while resistance looms at ZAR 86,611.7 and ZAR 87,042.0.

LNG Deal Brings $12B Trade Boost and Policy Optimism

South Africa recently proposed a massive 10-year LNG import deal with the U.S., targeting 75-100 petajoules annually—equivalent to 75-100 million cubic meters of gas per year. This deal is expected to bring in up to $1.2 billion per year, totaling $12 billion over the decade. Alongside LNG imports, the agreement includes duty-free quotas for automotive exports, steel, and aluminum, underscoring the deepening trade relationship.

This strategic move, combined with an anticipated 25-basis-point rate cut by the SARB, supports the outlook for improved economic growth. With inflation at just 2.8% in April—well within the 3%-6% target range—monetary easing seems imminent. Analysts believe this dovish shift, along with the LNG deal’s economic boost, will strengthen investor confidence and stabilize the rand.

Trade Setup: Channel Support Key for Next Move

Technically, the JSE Top 40 Index offers a clear trade setup. Watch for bullish confirmation—such as a bullish engulfing or three white soldiers formation—near the ZAR 85,550 channel support. A sustained rebound could push prices back toward ZAR 86,611.7 or higher. Conversely, a break below this level may open the door for a deeper retracement toward ZAR 84,660.3 or ZAR 84,139.9.

JSE Price Chart - Source: Tradingview — JSE Price Chart – Source: Tradingview

Resistance: ZAR 86,611.7, ZAR 87,042.0, ZAR 87,517.7
Support: ZAR 85,550.0, ZAR 85,230.7, ZAR 84,660.3
Momentum Watch: MACD reversal or crossover confirmation

In short, traders should monitor candlestick signals and momentum shifts to catch the next decisive move.

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ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.