02 Aug 2016 Technical Analysis Pick of the Week: Anglo American Plc
Technical analysis research from award winning international company, Trading Central, is available to Sanlam iTrade clients at no extra cost. This week we highlight Anglo American Plc, code AGL on the JSE or AAL:xlon for the London Stock Exchange listed version on our iTradeGlobal platform.
When you click on Trading Central Research under Markets/Data/Research you will see a list of the newest research as in the image below. The red and green arrows highlight the daily and weekly trend indicators. The change from the previous research study is also shown. The support level (SUP1 %) and first resistance level (RES1 %) are important. You should enter a stop-loss order at the first support level and should look at taking a profit on at least 50% of your position at the first resistance level. Ideally you would like a 2:1 risk/reward ratio, meaning your potential profit should be twice as much as your potential loss. In Anglo’s case your potential loss is 9% and reward is 19%, quite good.
When you click on the share name it opens a detailed analysis of the technical indicators of that company. The research expects Anglos to trend up to R187.51, the first resistance line. Your stop-loss should be entered at R142.31, the pivot line. The comment explains that the RSI is below 50 and the MACD is above its signal line and positive. The share is also trading above both its 20 and 50 day Moving Average.
Happy trading. Technical analysis can also assist long-term investors to enter a share at the right time.
– Gerhard Lampen
Head Sanlam iTrade Online