BOTTOM LINE: FBR has breached the support trend-line of its primary bull trend
In our last commentary in July, FBR had exceeded our downside target at 12,500cps, and was trading along its major support trend-line dated back to September 2013. We expected it to bounce there - but last week it dipped sharply through that trend-line.
With the 3-week RSI mega-oversold, FBR should recover soon. However, a bearish reversal below 12,500cps could see FBR confirm a negative breakout of its primary bull trend below 9,905cps, and the downside target would be at 7,570cps.
A recovery above 12,500cps would mark a change in sentiment, but a positive breakout of the bear trend would only be confirmed above 13,995cps.
Technical Analyst, Sharenet
Moxima has a B.Comm Finance from the University of South Africa and is a certified Chartered Market Technician Level 2, currently completing Level 3. She has been a technical analyst for 10 years, working for BJM, Noah Financial Innovation and for Standard Bank as part of the Research Team in the Treasury Division of CIB. She now runs her own business, The Money Hub, and consults for Sharenet. Moxima has been rated as one of the top 5 technical analysts in South Africa and outperformed the market during the recent recession. She regularly makes an appearance as a guest on CNBC Africa and writes often for Finweek and Sharenet’s Views.