Sponsored Links:
After a performance during 2011 that disappointed, the share price of microlender African Bank Investments Limited (Abil) has surged, breaking upside resistance. And it looks set to continue its climb upwards.
Abil: upside breakout
Recommendation: buy pullbacks.
Trend: short-term up, but overbought. Medium-term up. Long-term sideways.
Strategy: buy a pullback to the R36.50 level.
(Daily)
n After moving sideways for all of last year, Abil has now broken out of a large ascending triangle (lines 1 and 2). This is also a “complex” inverse head and shoulders (labelled), which is a bullish pattern.
In November it broke out of a large declining channel.
n Right now, though, it is overbought, as seen by the stochastic oscillator (on top). But expect any pullback to be temporary.
n Buy it on a pullback (such as to R36.50). Pullbacks are buyable all the way up, until its minimum upside target is reached.
n That target is R41.50 over the medium term. (This target is obtained by measuring the height of triangle 1 to 2 and projecting it up).
n Place your initial stop-loss as a close below R34.50. Traders take partial profits at the R40.40 level to reduce your overall risk on the trade.
Colin Abrams is an independent technical analyst. Visit colin@themarket.co.za to subscribe to more recommendations by him, or to attend courses, go to www.themarket.co.za
|
|
 |
 |
 |
 |
 |
Services
Buying a car has never been easy. Motoring.co.za contains a large database of car listings with a user friendly search.
Start searching today »
Financial Tools
You are here: IOL / Business / Business News / Technical analysis: Bank on Abil to keep rising
We like to make your life easier
Mobile
Browse IOL on your phone at m.iol.co.za.
Newsletters
Subscribe to our newsletters. News delivered to your inbox!
