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Anglo American Platinum Ltd
04 September 2015
We read yesterday that Sibanye Gold was in advanced talks with Amplats to purchase its Rustenburg mining assets. Sibanye has secured capital of $350 million through a debt facility that more than likely will be earmarked for platinum asset purchases as the company looks to diversify its portfolio. The share price in both companies rallied as the news was released with Amplats jumping over 9% in trade.
Technically, the share price looks to have moved off the double bottom pattern, temporarily reversing the downward trend and perhaps alluding to further upside. It is interesting to note the pennant pattern that capitulated with a break on the news yesterday and an increase in the volume. The pattern is indicative of a more bullish move in line with the preceding trend, which now has a more bullish upward bias. Significantly, the share price has broken and closed above the 200-day moving average, which previously served as resistance and now looks to become support for the share price.
We should also see a confluence here between the horizontal support (previous resistance) at 32500c and the 200-day moving average. The share price is well over-bought at these levels on the RSI and given all of the data we are expecting today and the closure of the Chinese markets one would expect some profit taking and pull back on the share to the new support levels. This should create a revised long opportunity at around 32500c for those bulls who now favour the upside as some of the exuberance on the news stutters. Bears may be looking to short the knee jerk reaction and will be looking for further downside if there is a break below 32500c, targeting the range to 31000c.
Sasol Ltd, 04/09/2015
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