We successfully traded a long position setup on this stock a few weeks back and experienced it as a tight trade requiring lots of patience with a high cost structure. Having said that, we now find a similar setup materialising on the charts and it does bear consideration. The weekly chart still remains highly bullish with the 21EMA, 89EMA and stochastic all pointing towards further strength. The stochastic is not overbought yet supporting the potential for further upside and there does seem to be a bullish divergence playing out at the moment.
On the daily chart we can see that the stochastic has moved sharply oversold but with the painting of a bullish daily candle a reversal from around the 50% retracement level is potentially on the cards.
Finally, on the support and resistance chart, we see how price has thrown back to the R12.50 support level where it is bouncing upward again
Putting all of this together, we can look to a potential long from the current level of around R12.60 with a view to moving back to R12.95 with a stop as a close below R12.45. Its a very tight trade as noted above so we'd grade it at 50% of risk size.
These 2 stocks have both broken 3LB daily swing levels - MND on the longside and PPC on the short side. For MND the entry zone would be between R314.06 and R320.00 with a stop on a close below R308.12 and upside targets at R331.88/R343.76 and R349.70
For PPC the entry zone would be between R17.01 and R16.69 with a stop on a close above R17.32 and downside targets at R16.06/R15.43 and R15.12
The AGL daily 3LB has broken down below it's previous swing low. The daily candle has however painted a long tail so caution needs to be taken as it could be bouncing here. So the entry trigger is on the break of today's price low of R111.50 with downside targets at R105.65/R99.80 and R96.88 and a stop in at R117.35. This one needs to be monitored carefully and if the stock moves bullishly, entry should be avoided.
RDF continuation long trade setup off an EOD 3LB break. Its a very tight little trade with the entry zone between R11.88 and R11.82 and upside targets at R12.00/R12.12 and R12.18. Stop comes in at R11.76.
Last week saw the long-awaited breakout we had been earmarking on the long side over the past couple of weeks and the subsequent price push towards the late April all time high levels. Consequently the weekly chart of the ALSI looks quite bullish with the stochastic oversold but still pointing firmly upwards.
On the daily charts we see the flag breakout on Friday and the failed stochastic reversal - all extremely bullish and indicative of further upside.
The support and resistance levels show us now approaching the April peak with the potential for some resistance on profit-taking but we'd then look for a move through this level and into uncharted territory.
So overall a bullish scenario in place and the plan is to keep letting long-side trades run as far as possible while taking quick profits on the counter-trend positions in the week ahead
End of day 3LB breakout scenario on MUR. Entry zone from R10.58->R10.94 with stop level as a close above R11.30 and downside targets at R9.86/R9.14 and R8.78
The KAP weekly chart clearly shows the strong bullish trend in place with respect to this stock. We also see an interesting bullish stochastic crossover which can be viewed as a failed stochastic reversal as the stochastic crosses back up over its signal line after reversing off overbought conditions - again a bullish sign.
The daily charts show how price has started moving off its low levels and is reversing upwards and this is reflected in the stochastic which has crossed upwards out of the oversold zone.
Finally the support and resistance chart shows how price has moved into a flag-type pattern on a 5th wave upswing with an anticipated breakout outcome reflected by the green line
Our setup is to enter the long on any intraday pullback to R6.60 or better with a stop set as a close below the swing low of R6.20. Target price is R7.50 as per the projected price line yielding a 2.25-1 reward-risk. Importantly we're doing this in anticipation of a breakout which enhances the trade risk somewhat so taking a smaller risk-based trade size is not a bad option.
Last week we believed that there was a potential for short-term pullback as the market consolidated following its recent break of resistance. This has pretty much been the flavour of the past week. The weekly chart shows the fairly small candle painting over the past 5 day period with the stochastic now in the overbought territory - although still pointing bullishly upwards.
The daily chart now clearly shows the stochastic moving downwards as it attempts to work off its overbought condition. The candlesticks make very interesting reading as a number of consecutive inside or near-inside days - again reflecting the anticipated consolidation has compressed price into a very narrow range. From a pattern perspective, we can see the making of a potential pennant formation which generally should see a break upwards in the direction of the trend entering the structure.
The support and resistance doesn't add much in the way of insight as we have price settling above support as anticipated to a certain extent.
So some mixed signals in the making with a bias being in the court of continued short-term consolidation to work off overbought conditions culminating in a bullish breakout towards new all time high levels. On balance we will continue with the approach of exercising caution on short-term positions in our daily trading - with quicker fixed target profit while letting our long positions run as far as possible. If price starts to move below the 47,000 level though this would change the equation.
On the daily 3LB graph we can clearly see how GRT breaks its previous swing low and resumes its bearish trend. The setup details are marked up on the right-hand price graph with the following parameters. Short between R24.98 and R24.76 with targets at R24.33,R23.90 and R23.69. Stop is a close above R25.19
Looking at the weekly chart of NGPLT, we can see that the stochastic is still pointing solidly downwards bus is not oversold as yet. The longer-term trend is also clear with the 21 EMA well below the 89 EMA.
On the daily chart, we can see how the stochastic is in overbought territory and is now starting to reverse downwards. Also noteworthy is the fact that price has retraced off its 05 Oct low to the 61.8% retracement level where a bearish engulfing candle has not forced it back downwards.
Finally on the support and resistance graph we see that price is reversing off a fairly strong lateral resistance level around the R132.00 mark and there is some good headroom for a move down to the rising support level going back to late July.
Our setup is thus as follows. Look to sell short around the current R130.00 level with a stop in as a close above R132.50 and a target at R125.00. This would yield a 2-1 reward-risk with a potential to improve on a better intraday entry.
The Weekly Top 40 graph reflects the significant recovery the market has undergone in the past couple of weeks and with the stochastic looking decidedly bullish and not overbought as yet, it seems that we may see the market test it's all time highs reached in April of this year.
The daily chart also makes interesting viewing as here we do see the stochastic moving oversold with the potential for short-term reversal as the market consolidates. However, with the 21EMA crossing above the 89EMA market pullbacks could now provide buying opportunities again.
Support and resistance clearly shows the break through lateral resistance and the expectation would be that we see a throwback to this level as price consolidates and resistance changes to support.
Lastly, we look at the 3LB graph where we can see the break of the previous swing high on 08 October 2015. This view also beautifully highlights the overhead resistance level which was broken.
Putting some interpretation to all of this, there is the potential for a short-term pullback to support as the T40 consolidates in the near-term but if that level holds, a move back up to the all-time high level around the 49,100 would not be surprising.
