Closing out Woolworths long position

The target identified as per the Woolworths long trade setup a couple of weeks back was met today and we took profit on the trade.

The gross reward-risk achieved after financing and brokerage costs was just shy of 2-1 which was slightly below the planned ratio of between 2.0 and 2.5-1. This was mainly on the back of additional brokerage costs because we scaled into the trade in 2 tranches.

Apart from that small deviation, the trade entries and exits were all in line with plan.

Closing out the AVI Long

After a promising start to the trade on 08 April in line with the original entry plan, the AVI long trade failed to gain the necessary momentum with the stochastic working off it's oversold condition and price painting some choppy daily candles. In line with plan management, after 5 days I started tightening the stop-loss using a hard-stop floating 1c below the 3 day low level. The result as shown below sees the trade stopped out today at R77.45 (R77.75 entry) for a 0.3% capital loss. Comfortable to take small losses where trade moves don't work in line with plan.

AVI Long position setup

The AVI setup is a bit weaker than the one for WHL posted earlier. The stock has chopped along sideways in consolidation mode for most of 2015 despite touching all time highs in March 2015. But the weekly trend remains bullish on balance and with the retracement on the daily charts pushing the stochastic oversold, the bullish reversal setup by the daily candles (very similar to WHL) presents a good potential long setup.

Support and resistance zones also look quite interesting. The stock appears to be at the base of downward sloping channel with a support zone around the R76.00 level where the stock is currently reversing off and resistance areas at R80.00 and then at the top of the channel at around the R83.00 level currently.

Setup details as follows: Enter long on a break of Friday's candle high at around R78.00 with a stop being a close below the R75.50 level and an initial target at R83.50. This yields a 2.2-1 reward-risk ratio. Important to keep an eye on the R80.00 level or potential resistance.

Woolworths long position setup

The past week has seen a significant in the WHL share price with the stock retracing more than 10% from its all-time high level. The longer-term weekly trend remains bullish though so the oversold stochastic provides an opportunity for us to look at taking a long position to capitalise on a bounce or movement back in the direction of the long-term trend. Thursday's long-tailed candle provides potential evidence of this bounce starting to materialise as sellers pushed the price down to a low of R87.00 intraday before the buyers forced the price back up to a R89.40 close. This was followed by a solid bullish candle on Friday. 

From a support and resistance perspective, there is a strong support area of confluence formed by the juxtaposition of lateral support at R87.00 and upward sloping trend lines going back to October 2013 and October 2014 respectively. Resistance levels come in at R92.50 and at the rounded R100.00 level.

Setup details as follows: Enter on a break of Friday's candle high at around the R90.00 level with an initial stop being a close below the R87.00 support zone. We would be a fading a break though the R92.50 resistance level so look to scale into the trade from R90.00 to R92.50 with the view to targeting the R100.00 level. This would yield a 2.0 to 2.5-1 reward to risk on the setup