Fortress Income Fund B (FFB) is one of the companies linked to the Resilient Group that has been in the news as of late. Firstly, as a few of the companies speculated to be in the crosshairs of short-seller Viceroy and then being revealed as one of the companies which has been named in a report by a local hedge fund who has been short the stock. These market speculations and news-flow has resulted in the price of FFB being under the hammer over the last two months, declining from a peak of around R42.00 to the most recent low of R13.90.
Although moving lower, the price has consolidated while the candle structure still sees buying interest in the downward trend. On 28 February, the MACD gave a bullish crossover while the RSI has started to move out of oversold territory. Over the last four trading sessions, the price has traded near the upper end of the consolidation range, indicating the potential start of a short term bullish reversal.
Given the potential for additional news flow and current risk around the company, I am viewing this buy/long trade idea as higher risk therefore traders should allocate less capital as a percentage of the entire portfolio.
These are the potential trade levels:
Buy/Long FFB close to 15.30/15.80
Take Profit Target: R19.70
Last Close: R15.62