Discovery Trade Update 03/08/2017
First target price of R145 was hit this morning. New recommendation is to move stop to R142 whilst waiting for the second target of R150.
Entry: R137.50
Stop Loss: R133.00
Target Price 1: R145.00 (First Target Hit 03/08/2017)
Target Price 2: R150.00
Discovery and Coronation Technical Takes - 25 July 2017
Discovery and Coronation are looking ripe technically for some upside in the short to medium term.
Discovery
Summary:
Entry: R137.50
Stop Loss: R133.00
Target Price 1: R145.00
Target Price 2: R150.00
Source: Bloomberg
Discovery closed above a key resistance line on Friday after having broken out above it on Wednesday. If it stays above the channel (R125-R137) then there is opportunity for substantial upside.
Entry – If you are not already in the position wait for a close above the resistance line at R137.50 before getting into the trade. Keep holding the long if the position is already held.
Stop Loss - Initial stop loss should be at R133.00, and once the trade moves above R140.00 move your stop loss to entry.
Target Price - The full target price for the taking profits is R150.00 based on the height of the breakout. Take half of the profits at R145.00.
Caution – Volatility in this stock is relatively low therefore the trade might take relatively longer to complete compared to other trades. Outlook for the trade is at least 2 weeks.
Coronation
Summary:
Entry: R67.22
Stop Loss: R66.00
Target Price 1: R69.50
Target Price 2: R72.50
Source: Bloomberg
Coronation is in a short-term uptrend and the current strength of the rand will play a key factor in the short-term. The slow stochastic indicates signs of being overbought but I do not think we have seen the end of this move yet. We might see a minor retracement from this current price level but the short-term uptrend should continue.
Entry - Buy above R67.22 which is the initial resistance which has now turned into a key support level for the stock.
Stop Loss – Initial stop loss should be at R66.00. Adjust once the first target price is reached to the initial entry-level.
Target Price - The first target price is R69.50 where we expect to take most of the profits because that is significant resistance level. The rest of the profits should be taken at R72.50.
Caution – Rand will play a significant role in price action therefore if the stock starts to weaken due to extensive Rand shocks obey the stop loss.
Wishing you a profitable day of trading.
Musa Makoni | Trading Specialist at GT247.com
Wishing you a profitable day of trading.
