Cape Town - Cement producer PPC [JSE:PPC] has been recovering over the past eight months, and has given a new upside breakout on its chart, as shown here.
PPC – New breakout
Recommendation: BUY (OR ADD TO)
Current Trend: Short- and med-term up. Long-term turning up.
Strategy: Buy at current levels.
Chart Setup: PPC has been a hold here from when it broke out of a large inverse head and shoulders a couple months back (not shown). It’s been moving sideways since then in a channel (lines 1 and 2), and recently broke out of the top of that channel (line 2 at R8.50). It’s pulled back in recent days to retest that breakout level, and is now heading higher again.
Strategy Details: It remains a med-term hold, and it’s a buy at current levels if not in.
Target: Minimum target is R10.30, based on channel 1-2 projected up. Lock in some profits there. But ultimately it’s pointing to a far higher target of R15, based on a large inverse head and shoulders (Sep 2016-Jan 2018).
Stop-loss: A close below R7.00 (line 1). (Line 3 support is R8.20 if you’d prefer it tighter stop). Once it trades up to R9.40, raise stop to a close below line 2 (R8.50).
- Colin Abrams is an independent technical analyst. To subscribe to more recommendations by the author, or attend trading courses, please go to www.themarket.co.za
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