MoneyWorx Shaun van den Berg 22 February 2011

International Outlook Brent Crude Oil Gold-$ & Platinum-$ Silver $ & Copper US$ versus Euro & GBP JPY versus US$ DJ Industrial Average S & P 500 Index Nikkei Index Hang Seng Index DAX Index CAC 40 Index FTSE Index Local Outlook Gold Rand Platinum Rand Rand vs US $ & Euro JSE Overall Index Top 40 Index Mid Cap & Small Cap Index Alt-X Index Gold Mining Index Platinum Mining Index Resource 20 Index Financial 15 Index Industrial 25 Index Summary & Conclusion Technical Market Overview

Economic Indicators Brent Crude Oil Gold-$ Platinum-$ US$ versus Euro US$ versus GBP JPY versus US$

Brent Crude Oil Still Bullish Still Bullish

Gold-$ Support Support Resistance Resistance Bullish Bullish Support Support

Platinum-$ Support Support Resistance Resistance Support Bullish Bullish

Silver-$ Bullish Bullish Resistance Support Support Support

Copper-$ Bullish Bullish Resistance Resistance Resistance Support Support

US$ vs Euro $ Weakness / Euro Strength $ Strength / Euro Weakness Support Support Resistance US$ weakness US$ weakness Resistance

US$ vs GBP $ Strength / GBP Weakness $ Weakness / GBP Strength Support Resistance US$ weakness US$ weakness Support

JPY vs US$ JPY Weakness/ $ Strength JPY Strength / $ Weakness Resistance Resistance Support JPY turning weaker JPY turning weaker

What can we learn? Bullish Brent Crude oil priceBullish Brent Crude oil price –Demand / Speculation? –Uncertainty around Middle East Precious MetalsPrecious Metals –Bullish gold $ (25-year high) –Bullish Silver (30-year high) –Bullish Platinum-$ & Copper US DollarUS Dollar –Weaker against Euro & Weaker against GBP –Turning stronger against JPY in short-term/ Weaker in longer-term

International Markets DJ Industrial Average S & P 500 Index Nikkei Index Hang Seng Index DAX Index CAC 40 Index FTSE Index

DJ Industrial Average Support Bullish Bullish Resistance Resistance Support Support

S&P 500 Index Very Bullish! Very Bullish! Support Resistance Resistance Support Support

Nikkei Index Bullish Bullish Support Support Resistance Resistance Support Resistance / Support Resistance / Support

Hang Seng Index Bullish but sideways Bullish but sideways Resistance Resistance Support Resistance / Support Resistance / Support

DAX Index Bullish Bullish Resistance Resistance Support Support

CAC 40 Index Bullish Bullish Resistance Resistance Support Support

FTSE 100 Index Bullish Bullish Resistance Resistance Support Support

What can we learn? US Markets (DJIA / S&P 500)US Markets (DJIA / S&P 500) –Very Bullish (Broken above resistance/ Overbought) –Overbought (Sustainable?) Asian MarketsAsian Markets –Nikkei Index: Bullish / Overbought –Hang Seng Index: Bullish but moving sideways / Becoming more Oversold European MarketsEuropean Markets –DAX Index: Bullish / Overbought –CAC 40 Index: Bullish (Broken resistance) –FT100 Index: Bullish (Trading within an up-channel)

Local Market Gold Rand Platinum Rand Rand vs US $ Rand vs Euro Rand vs GBP JSE Overall Index Top 40 Index Mid Cap Index Small Cap Index Alt-X Index Gold Mining Index Platinum Mining Index Resource 20 Index Financial 15 Index Industrial 25 Index

Gold Rand Support Support Bullish Bullish Resistance Resistance Support Broken Resistance Broken Resistance

Platinum Rand Bullish Bullish Resistance Resistance Support Support Broken Resistance Broken Resistance

Rand vs US $ Rand Strength / $ Weakness Rand turning weaker Rand Weakness/ Euro Strength Testing Support Resistance Resistance Support

Rand vs Euro Rand Strength / Euro Weakness Rand Weakness/ Euro Strength Rand Weaker Support Broken Support Resistance Resistance Support

Rand vs GBP Rand Weakness/ GBP Strength Rand Strength/ GBP Weakness Support Rand Weakness Resistance Resistance Support Testing Support

What can we learn? Gold RandGold Rand –Bullish / Broken Resistance Platinum RandPlatinum Rand –Bullish/ Broken Resistance Rand turning weaker vs USDRand turning weaker vs USD –Testing Support trend lines Rand weaker vs EUR & GBPRand weaker vs EUR & GBP –Testing Support trend lines Rand Hedge Shares?Rand Hedge Shares? Opportunities?Opportunities?

Market Indicators JSE Overall IndexJSE Overall Index Top 40 IndexTop 40 Index Mid CapMid Cap Small CapSmall Cap Alt-X IndexAlt-X Index Gold Mining IndexGold Mining Index Platinum MiningPlatinum Mining Resource 20 IndexResource 20 Index Financial 15 IndexFinancial 15 Index Industrial 25 IndexIndustrial 25 Index

JSE Overall Index (Weekly) Support Resistance Resistance Bullish Bullish Resistance Resistance Support

JSE Overall Index Bullish Bullish Support Resistance Resistance Support

Top 40 Index Bullish Bullish Resistance Resistance Support Support

Top 40 Index Bearish Divergence Overbought/ Bearish Divergence

Top 40 Index Market Outperforming Resistance Resistance Support

Mid Cap Index Support Turning / Underperforming Resistance Resistance

Small Cap Index Turning / Underperforming Resistance Resistance Support

Alt-X Index Support Resistance Resistance Turning / Underperforming

What can we learn? JSE Overall IndexJSE Overall Index –Double-Top (Weekly) –Bullish but turning –Testing Resistance –Rising Wedge Top 40 IndexTop 40 Index –Bullish –Overbought –Bearish Divergence –Outperforming Mid Cap IndexMid Cap Index –Sideways / Oversold –Market Underperform Small Cap IndexSmall Cap Index –Bullish –Testing Support –Market Underperform Alt-X IndexAlt-X Index –Sideways / Bearish –50% Retracement –Underperforming

Market Indicators JSE Overall IndexJSE Overall Index Top 40 IndexTop 40 Index Mid CapMid Cap Small CapSmall Cap Alt-X IndexAlt-X Index Gold Mining IndexGold Mining Index Platinum MiningPlatinum Mining Resource 20 IndexResource 20 Index Financial 15 IndexFinancial 15 Index Industrial 25 IndexIndustrial 25 Index

Gold Mining Index Resistance Resistance Broken Resistance Broken Resistance Support Bullish / Overbought / Market Performing Overbought

Gold Shares - Anglogold Support Resistance Resistance Bullish Bullish Support

Gold Shares - Anglogold Volume Accumulation Market Outperform? Bullish Overbought Hold

Gold Shares - Harmony Bullish Bullish Support Resistance Resistance

Gold Shares - Harmony Market Outperform Volume Accumulation Bullish Overbought Buy

Gold Shares – Gold Fields Bullish Bullish Resistance Resistance Support

Gold Shares – Gold Fields Market Outperform Volume Accumulation Bullish Overbought Hold

Platinum Mining Index Bearish Divergence Bearish but turning / Overbought / Underperforming Support Resistance Resistance Market Underperform

Platinum Shares -Angloplats Market Underperform Volume Accumulation Overbought Bullish Sell

Platinum Shares - Implats Market Underperform Volume Accumulation Oversold Bullish Buy

Resources 20 Index Bullish/ Overbought / Outperforming

Resource Shares - Anglo Bullish Bullish Resistance Resistance Support

Resource Shares - Anglo Market Outperform Volume Accumulation Overbought Bullish Hold

Resource Shares – BHP Billiton Resistance Resistance Support Testing Support Bullish Bullish Resistance Resistance

Resource Shares – BHP Billiton Market Outperform Volume Accumulation Overbought Bullish Hold Bearish Divergence

Resource Shares - Sasol Resistance Resistance Support Bullish Bullish Support

Resource Shares - Sasol Market Outperform Overbought Volume Accumulation Bullish Hold

Arcmittal Resource Shares - Arcmittal Bullish Bullish Support Resistance Resistance Support

Arcmittal Resource Shares - Arcmittal Market Underperform Overbought Bullish Volume Accumulation Hold

Exxaro Resource Shares - Exxaro Resistance Resistance Support Support Bullish Bullish

Exxaro Resource Shares - Exxaro Volume Accumulation Overbought Market Outperform Bullish Bearish Divergence Hold

Summary – Mining & Resources Gold Mining IndexGold Mining Index –Bullish –Broken Resistance –Market Perform Platinum MiningPlatinum Mining –Bearish but turning –Overbought –Underperforming Resource 20 IndexResource 20 Index –Bullish –Overbought –Market Outperforming

Financial 15 Index Bullish/ Down channel / Oversold Resistance Resistance Support

Banking Index Bullish/ Oversold Resistance Resistance Support

Bank Shares - ABSA Oversold Market Underperform Bearish Volume Accumulation Watch

Bank Shares – Firstrand Overbought Volume Accumulation Bullish Market Underperform Bullish (Just!) Bullish (Just!) Buy

Bank Shares – Stanbank Volume Accumulation Bearish Market Underperform Oversold Watch

Bank Shares – Nedbank Overbought Volume Distribution Market Underperform Bearish Watch

Life Assurance Index Bullish/ Overbought / Outperforming

Life Assurance - Sanlam Market Underperform Volume Accumulation Bullish Oversold Watch

Life Assurance– Old Mutual Overbought Volume Accumulation Market Outperform Bullish Hold

Real Estate - Growthpoint Oversold Volume Distribution Market Underperform Bullish (Just) Bullish (Just) Watch

Real Estate - Redefine Oversold Volume Distribution Market Underperform Bearish Bearish Watch

Industrial 25 Index Bullish to Neutral / Overbought / Bearish Divergence

Industrial Shares – MTN Group Oversold Volume Accumulation Market Underperform Bullish Bullish Watch

Industrial Shares – BATS Overbought Volume Accumulation Market Underperform Bullish Hold

Industrial Shares – SAB Miller Overbought Volume Accumulation Market Perform Bullish Hold

Industrial Shares – Richemont Volume Accumulation Market Outperform Overbought Bullish Hold

Summary – Financial & Industrial Financial 15 IndexFinancial 15 Index –Bullish –Down Channel –Oversold Banking SharesBanking Shares –Bearish –Oversold –Underperforming Life Assurance SharesLife Assurance Shares –Bullish –Overbought –Outperforming Real Estate SharesReal Estate Shares –Bearish –Oversold –Underperforming Industrial 25 IndexIndustrial 25 Index –Bullish –Overbought –Outperforming

Share Recommendations: Sasol The company trades at a p/e of 13 which is much lower than the current market average. It has a dividend yield of 2.8%. The current oil price will help the company to improve results. The rand can also help if it devaluates further. Deon Botha

Share Recommendations: MTN The company trades at a p/e of 14 which is lower than the current market average. The improvement in consumer spending; local and the rest of their markets; would help the company to improve results. The management comment of the company is positive. Deon Botha

Share Recommendations: ABIL Still staying with this one The company trades at a p/e of 14 which is much lower than the current market average. It has a dividend yield of 5.1%. The improvement in consumer spending will help the company to improve results. Bad debts would also reduce. The furniture business is also improving. They have given a positive trading update. Deon Botha

Share Recommendations Still with Mr Price (MPC), I believe it should at least reach the original neckline of 6400, trading around 6050 today. Also still with Woolies(WHL) next resistance at 2700 and then 2800 trading around 2600 today. My third choice is Discovery (DSY) It has been trading in an upward channel for some months now, at the moment it is at the bottom of the channel and the oscillators are in oversold territory, looking for close to 4400, today trading around 3900 Derick Brooks

Share Recommendations Bowcalf: Good results from the company and not expensive GFields: Gold shares to outperform the markets. The company is well placed to take advantage of the upside Adcock: Defensive share Nick Chryssanthou

Conclusion MoneyWorx –Presentation will be ed –On the Forum Market is Bullish but Overbought –Shorting Opportunities? Good Luck & Happy Trading!

Trading the Breakout Pullback Price Pattern version 0211 Marino Kekana Tel: Fax:

Contents What is the breakout pullback price pattern Why do I trade this chart pattern Where does it fit in the context of other trading styles How do I trade the breakout pullback chart pattern What are my findings What do these findings tell me What is my recommendation

Breakout pullback price pattern

What is it? –Price pattern that begins with an uptrend and followed by a pullback; and –A position is entered at the beginning of the next uptrend Why trade it? –I can scan for this price pattern setup –Candidate shares are trending up/down –Profitable with the first pullback scenario –I can trade using candlesticks only –Technical indicators are not a necessity

Breakout pullback price pattern Where does it fit in trading styles –Swing trading It attempts to capture short term moves in the share –I do not care about Fundamentals of a company Kinds of products they sell What the name of the company is –I want to know if There is money flowing into the share There is money flowing out of the share I can trade the share with least possible risk to my capital

How do I trade the breakout pullback price pattern? Part 1: Trading basics –Share market stages –Trending price vs trading range –Moving averages –Candlestick price chart –Share volume –Price levels: support and resistance –Relative strength

Share market stages Stage 1 –price has been going down and starts to trade sideways –generally everybody hates this share Stage 2 –price breaks out, begins an uptrend –fundamentals are still bad Stage 3 –price trades sideways, ready to begin downtrend –it is similar to Stage 1 Stage 4 –price on the downtrend –fundamentals probably are still good –nobody believes the downtrend, they think it is a correction Stage 1 Stage 2 Stage 3 Stage 4

Stock market stages Stage 1 Stage 2 Stage 3 Stage 4

Trending price vs. trading price ranges Trending price pattern: –Trend is up or down Up price trend –Higher highs –Higher lows –pullbacks are short lived Down price trend –Lower highs –Lower lows –rallies are short lived Trading range pattern –Trend is sideways –Price pattern is sloppy

Trending price vs. trading price ranges Trending price rangeTrading price range

Moving averages I use sma(10) and ema(30) –To determine the price trend –To recognize changes in the price trend When the price trend is –Up sma(10) > ema(30)buy long –Downsma(10) < sma(30)sell short –Changingsma(10) x sma(30) stay in cash I use sma(200) –to separate the bull territory from the bear territory

Moving averages

Candlestick price chart Categories of candles –Wide range candle: high volatility (interest in the share) –Narrow range candle: low volatility (little interest in the share) –Low volatility → high volatility → low volatility

Share volume Volume chart –Shows number of shares traded during a time interval –Low share volume: little interest in the share –High share volume: lot of interest in the share Liquidity –How easily it is to get in and out of a share –High share volume → liquidity Volume and price –Interpreting volume on a price chart can be very confusing

Price levels: support and resistance Support and resistance price levels –Areas where share price reverses –I do not buy when price approaches resistance level –I will not sell when price approaches support level –Why? Share price tends to reverse in close proximity to popular price levels support resistance

Relative Strength Buy long –Shares stronger than the industry –Industry stronger than the market Sell short –Shares weaker than the industry –Industry weaker than the market

How do I trade the breakout pullback price pattern? Part 2: Trading Strategy –Traders action zone –Elliot wave pattern –Market timing –Scanning for shares –Entry strategy –Exit strategy Stop loss order Taking profits –Putting it together

Traders action zone Buy and sell zone on a chart used to identify possible price reversals in share The area between sma(10) and ema(30) When the price pulls back into this zone, look for trading signals: support and resistance, candlestick patterns, etc…

Traders action zone

Elliott wave pattern Wave 1: breakout Wave 2: Pullback Wave 3: hold onto position for longer time Wave 4: signals that the best part is over Wave 5: last burst before downtrend

Market Timing What types of trades to focus on –sma(10) is above ema(30) focus on long positions only –sma(10) is below ema(30) focus on short positions only Williams %R or Slow Stochastic gives an idea of when the market has reached a short term extreme –When to buy sma(10) is above ema(30) and Williams %R(3) is below -80 –When to sell sma(10) is below ema(30) and Williams %R(3) is above -20

Scanning for shares USACANADARSA Volume200,000100,00050,000 Price$10+$5+R2.50+ Shares1, USARSA Criteriasma(10)>ema(30)>sma(20 0) Shares30030

Scanning for shares in Traders Action Zone Price uptrend – long side –sma(10) > ema(30) –ema(30) > sma(200) –closing price < sma(10) –closing price > sma(30) –ADX(10) > 20 –volume > 50,000 –closing price > 500 Add price pullback –daily high < yesterday’s daily high –yesterday’s daily high < 2 days ago daily high Price downtrend – short side –sma(10) < ema(30) –ema(30) < sma(200) –closing price > sma(10) –closing price < sma(30) –ADX(10) > 20 –volume > 50,000 –closing price > 1000 Add price rally –daily low > yesterday’s daily low –yesterday’s daily low > 2 days ago daily low

Entry strategy: Swing point approach

Exit strategy: Stop loss and profit taking Stop loss

Putting it together share_screener.xls

My Findings Entry strategy: swing point low Buy price 176 Exit price 150 Months: 0 Exit reason: stop loss Comment: wide range candle triggered stop loss too early

My Findings Entry strategy: swing point low Buy price 99 Exit price 134 Months 5 Exit reason: sell order – well done Comment: protected profit after SENS

My Findings Entry strategy: swing point low Buy price: 556 Exit price: Months: 0 Exit reason: Comment:

My Findings Entry strategy: swing point low Buy price: 75 Exit price: Months: 2 Exit reason: Comment:

What do these findings tell me I can scan for this price pattern setup = yes Candidate shares are trending up/down = yes Profitable with the first pullback scenario = yes I can trade using candlesticks only = yes Technical indicators are not a necessity = yes

What is my recommendation Additions to checklist –Fibonacci retracements –Candlestick reversal patterns –Early signals for trading range Money management Identify professional traders Other chart patterns (for beginners)

Bibliography

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