Short term
Trade view / 04 May 2016 at 7:54 GMT

South Africa's Shoprite, Investec hove into view

Head of Private Sales / Saxo Capital Markets - South Africa
South Africa
Instrument: SHP:xjse
Price target:
Market price:


Both South Africa's Shoprite Holdings and Investec have triggered indicators that could see them both break out in the near term. We look at each separately here.



The exponential moving averages have crossed over to the upside at Rand 169.98, which could signal a potential continuation of the upward trend. In stochastics, a recent crossover shows potential for further upside, although some divergence is present. A formation of a declining wedge and a high wave candle shows potential of a break above R174.50, provided we see candles with positive and convincing days to the upside.

Management and risk description

Daily ranges have been on the decline and is currently at R5, showing volatility in the stock is slowing and a low risk potential stock with a risk:reward ratio of R5:10 from the current price. 


Entry: R165-170.

Target: R1.74.50, R180

Time horizon: short term.

SHP could be set for a break


Source: Saxo Bank



Investec stock has tested R112 three times over the last 5 months and not managed to move higher. Momentum is being tested with higher volumes to the downside, given the below technical events. The Exponential Moving Averages have not crossed over and currently testing the 21-day EMA, while trading below the 10-day EMA, potential break of moving averages to the downside.

Stochastics are currently above 80 with a crossover toward downside potential, no divergence present. Volume over the last three trading sessions has seen higher than normal average volumes supporting current downside pressure.

The chart shows a gap in price just below R105 which is a potential support level, with triple tops highlighted on the graph.

Management and risk

The risk and volatility is relatively low and a good R2.50:R5 risk to reward ratio for stop and take profit limits.


Source: Saxo Bank

— Edited by Martin O'Rourke

Non-independent investment research disclaimer applies. Read more


The Saxo Bank Group entities each provide execution-only service and access to permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on or as a result of the use of the Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail