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Technical Analysis

Weekly Technical Analysis

Each week Shaun Murison analyses a number of key indicators and sectors to identify price patterns and market trends relevant to trading on the local market.

Table of Contents

1. South Africa 40

Technical analysis of the local index

2. Chart of the week

MTN

3. Market Overview

Technical analysis of the local market by sector

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Technical Analysis

1. South Africa 40 – 27 September 2011

Above we can observe the Bollinger Bands holding closely to the price. This confirms the current consolidation on the South Africa 40 index

The SA40 has moved from the top of our range back down to the bottom of the range this week

The oscillator and the price marked with green lines are now showing positive divergence (price making higher lows while indicator making lower lows)

This divergence is seen as a short term bullish signal, and if a rally does occur, the 28000 level at the top of the range would be considered

Breakout levels would now be considered at 28345 and 26015 as marked above, and the widening Bollingers would be seen as a technical confirmation of the commitment to a new direction


Technical Analysis

2. Chart of the Week – 27 September 2011 MTN

Above we can observe the price of MTN finding support just above the 13000 level

We can also see that the price has bounced off of this level and is currently heading up

When we see a volume spike after recent declines in price, it is referred to as a selling climax (marked with red arrow) and suggests a reversal to the upside


Technical Analysis

3. Market Overview – 27 September 2011

Key Indicators S&P 500 South Africa 40 USD/ZAR Spot Gold

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Down Sideways Up Sideways

Down Up Up Sideways

Down Down Up Up

Increasing Increasing Increasing Increasing

Neutral Neutral Neutral Oversold

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Sideways Sideways Down Sideways

Up Up Down Sideways

Up Up Down Down

Decreasing Decreasing Increasing Increasing

Neutral Neutral Neutral Neutral

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Down Sideways Sideways

Down Down Down

Down Down Down

Increasing Increasing Flat

Neutral Neutral Neutral

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Sideways Up Sideways Sideways

Down Up Up Up

Down Up Sideways Up

Flat Decreasing Decreasing Decreasing

Neutral Neutral Neutral Neutral

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Up Sideways Sideways Sideways Sideways Sideways Sideways

Sideways Sideways Down Sideways Sideways Sideways Up

Sideways Up Down Up Down Up Up

Flat Increasing Flat Increasing Decreasing Increasing Decreasing

Neutral Oversold Neutral Oversold Neutral Oversold Oversold

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Sideways Sideways Down Sideways

Sideways Down Down Down

Down Down Down Down

Decreasing Flat Decreasing Decreasing

Neutral Neutral Neutral Neutral

Banks Absa FirstRand Nedbank Standard Bank Financial Investec (inl) Investec (inp) Old Mutual Food Retailers Pick 'n Pay Shoprite Spar Tigerbrands Retailers Compagnie Richemont Foschini JD Group Mr Price Steinhoff Truworths Woolworths Construction Aveng Group Five M&R WBHO


Technical Analysis

Telecomms MTN Vodacom Telkom

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Down Sideways Down

Up Up Down

Up Up Down

Increasing Decreasing Increasing

Oversold Neutral Oversold

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Up Up Up

Up Up Up

Up Up Up

Decreasing Decreasing Decreasing

Overbought Overbought Neutral

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Sideways Sideways Down Sideways

Sideways Sideways Sideways Down

Down Down Down Down

Flat Flat Flat Flat

Overbought Neutral Neutral Neutral

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Up Sideways Sideways Sideways Sideways Up

Up Down Down Up Sideways Sideways

Down Down Down Up Sideways Down

Decreasing Flat Flat Decreasing Increasing Decreasing

Neutral Neutral Neutral Neutral Neutral Overbought

Near trend

Intermediate trend

Primary trend

Volatility

OB/OS

Up Sideways Sideways Up Sideways Sideways Sideways Sideways Up

Up Down Sideways Up Sideways Sideways Up Sideways Up

Sideways Down Sideways Up Down Down Up Down Up

Decreasing Decreasing Flat Decreasing Increasing Decreasing Decreasing Decreasing Flat

Neutral Neutral Neutral Neutral Oversold Neutral Neutral Neutral Neutral

Gold Anglogold Goldfields Harmony Platinum Angloplat Impala Lonmin Northam Resources African Rainbow Anglo American Plc BHP Billiton Exxaro Kumba Sasol Industrials Aspen Barloworld Bidvest Discovery Imperial Naspers Remgro Reunert SABMiller

Shaun Murison Weekly Technical Market Commentary shaun.murison@igmarkets.co.za


Technical Analysis