Technical Tuesday

23 June 2015

Our weekly technical report is compiled by in-house market analyst Shaun Murison

In the report this week we look at the South Africa 40 index, key indicators as well as the following equities:

Adcock Ingram Holdings Ltd

AECI Ltd

Remgro Ltd

South Africa 40 index

Technical view

The South Africa 40 cash index has finally reached the upside resistance target at 46900 and is now attempting to further break the level at present. The short-term trend bias now appears firmly up. Should the index price manage to close above resistance at 46900, the next upside target favoured is 47700.

Breakout traders may still consider a pullback (should it occur) to 46580 buyable targeting a move back to 46900. Traders that are already long may consider a close below trend line support (currently at 46350) as a trailing stop level.

Click here to view South Africa 40 chart

Equities in focus

Adcock Ingram Holdings Ltd

The price of Adcock Ingram has broken out of an inverse head and shoulders formation labelled L, H and R on the chart. The pattern warns of a reversal of the downtrend which preceded the pattern.

The height of the pattern projected from the breakout level at 5000 arrives at an upside target of 5435. A price close below the right shoulder (Labelled R) at 4795 would consider the failure of the reversal pattern.  

Click here to view Adcock Ingram chart

AECI Ltd

After the recent sharp decline on the share price of AECI, the price looks to be reversing off horizontal support. At the same time, we see the stochastic starting to move out of oversold territory, supporting the price action.

With this in mind, a rebound from the preceding decline is considered and resistance at 12000 is the favoured target. A failure in the anticipated rebound would be considered should the price close below the recent low at 11000.

Click here to view AECI chart

Remgro Ltd

The price of Remgro looks to be breaking out of a double bottom formation (blue W below 24900). The pattern warns of the preceding downtrend now starting to reverse back up. The height of the pattern projected from the breakout area arrives at an upside target of 25950.

A price close below trend line support at 24600 would consider the failure of the bullish indication.

Click here to view Remgro chart

Market overview

A Technical Analysis overview of key indicators and sectors with regards to trend, volatility and overbought/oversold conditions.

Click to view this week's market overview

 

 

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IG provides an execution-only service. The material on this website does not contain (and should not be construed as containing) investment advice or an investment recommendation, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of the above information. Consequently any person acting on it does so entirely at his or her own risk. The research does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. This communication must not be reproduced or further distributed. The price levels provided are derived from ProRealtime Charts (IT-Finance)

South Africa 40 chart

Source:  ProRealTime charts, as of 23/06/2015

Adcock Ingram chart

Source:  ProRealTime charts, as of 23/06/2015

AECI chart

Source:  ProRealTime charts, as of 23/06/2015

Remgro chart

Source:  ProRealTime charts, as of 23/06/2015

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