Technical Trade Idea: Tongaat Hulett (TON)

Technical Trade Idea: Tongaat Hulett (TON)

Mid-cap sugar producer Tongaat Hulett has been hit hard on the back of falling sugar prices, a stable Rand and concerns over political developments i.e. land expropriation without compensation. The share price is down from it’s peak of R120 in mid-January after opening the year at R114.57.

With the local unit looking to push through some key resistance levels and sugar very much oversold in the short term, TON could attract some buyers at current levels.

Technically, the price has developed a falling wedge pattern, with the RSI (Relative Strength Index) signaling bullish divergence and moving up from out of an oversold level.

While the weekly chart view has a bearish bias, the short term share price outlook may be presenting an opportunistic buy.

Trade levels: 

Buy TON at current levels (R98.43) up to R99.20
Stop-loss: R95.00
Take Profit Target: R109

Leave a Reply

Your email address will not be published. Required fields are marked *