Finweek Technical Analysis: AVENG - POTENTIAL BREAKOUT

Finweek reported that Aveng's technical indicators point to a positive medium term trend.Trend: Short term down, but oversold. Medium and long term up. 
Strategy: Traders buy on a close above line 4. 
* Aveng has given an orderly pullback over the past month in a channel (lines 3 and 4). The price has reached its rising 50-day moving average, coinciding with line 1 support. The odds favour an upside breakout above line 4 soon. 
* The daily stochastic is giving a positive divergence from its oversold level (ie, it hasn't made a new low, unlike its price), which is an early warning of a rally to come. 
* Traders buy on a close above line 4 (R42,85). Note: Investors who are not already in can still buy. 
* Once the breakout above line 4 occurs, the minimum upside target will be R47,20. Take half trading profits there. Keep a portion on (for traders) for further upside to R49. 
* Place your initial stop-loss as a closing price below R40.

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