Week 19 – 23 October – analysis

Planning trades in advance is a very important part of a trader’s success but most importantly is following the plan and trade the plan. In this post, I go through some of the opportunities I’m looking at, looking at weekly charts.

Mediclinic

The share has been trading in the R65-R54 range since late 2019. With a breakout earlier this year, with what proved to be a false break. Forming a head and shoulders pattern. The share finished the past with a bearish engulfing candle after the resistance R64 resistance held quite well. Looking for a short trade on a 3% break of the R54 support, looking for a close below R52. Important to note is that the 50 week EMA also held as resistance again.

Firstrand

We have a nice bearish flag on the share. The previous week’s bearish engulfing candle looks to be playing out. We also had a golden cross in the early stages of the flag formation. If we break below the R34 level, we could see some further pressure on the share. R29, 25, and R14 levels are potential targets. We might see some reactions at those levels. As they were support back in 2013-2014.

Britsh American Tobacco

The share has been trading in the R708-R494 range since 2019. The share has been trending downwards towards the bottom of the range, before pausing first in the R600-560 range. It recently tested the 50 week EMA, and it held well as resistance. If we break below the R560, more so below R543 (3% below the support). We could see some more pressure on the share targeting the R494 levels.

Tigerbrands.

The share testing its downward resistance trend line, traded above it, but didn’t close beyond it. There’s a potential symmetrical triangle play here. We will see over the next few weeks if the trend line holds a resistance again.

Bidvest

We have a golden cross on the share. The share has been in a trading range since April. The R132.50 has been a strong support level. If we get a 3% break and close below R128.50 level. We could potentially see some further weakness in the share. To perhaps close the gap from back in 2016 May

Discovery

The insurance giant is giving some conflicting signals. A possible restest of the 200 Week EMA after breaking it and having a golden cross. A possible bullish rectangle flag, and a possible head and shoulders pattern. The share currently trading around the 200 EMA. Let’s wait and see which side wins this one. Bull or the bears

Exxaro

We have a potential head and shoulders pattern building in the share. The past 3 weeks gave us a classic 3 white soldiers pattern. The share broke the R128 resistance/support, if we close 3% above it on the daily chart at R131, we could potentially see the uptrend continue and the head and shoulders pattern play out.

Impala platinum 

 

We have a rectangle bullish flag on the share. Looking positive for a breakout above the R169 levels. We could see some further strength in the share

Investec 

We had a symmetrical triangle pattern on the share. The share broke out. It retested the base of the triangle (trendline) over the past 2 weeks. It ended the past week with a bearish engulfing candle. We could see some selling off on the share over the next few weeks/months

Mondi 

 

We have a potential bullish flag (more visible on the daily chart) on Mondi. Looking for some further strength on the share. After the share tested what was a resistance level before the share broke through it.

MTN Group

 

The share broke out of the bearish flag, however, there are buyers of MTN around the R53.60-R53 level holding off the selling pressure. The sellers seem to be quite stronger than the buyers as the share has been making lower highs and lower lows (more visible on the daily chart). Should the sellers push the price to around the R51.80 level where most stops could be sitting. Most of the bulls could feel some pain and their exit could further put pressure on the share. 

Nedbank

 

We have a bearish flag on the share. The share had been making lower lows and is quite close to the break below the R90 support. Should we have a 3% break and close below it (R87). We could see some pressure on the share.

Standard bank

 

We have a bearish flag on the share. The share had been making lower lows and is quite close to the break below the R100 support. Should we have a 3% break and close below it (R97). We could see some pressure on the share.

Truworths

 

We have break out the symmetrical triangle on the share. We could see some sell of pressure on the share. Using the width of the triangle from its broadest point. A potential target is R13 level

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