Technical trading view of SA's biggest, dedicated clothing retailers
A comparison of South African retailers Mr Price Group Ltd, Truworths International Ltd. and Foschini Group Ltd
Mr Price Group Ltd
Mr Price has seen a strong upside breakout from the flag formation. This is highlighted by the blue channel. The breakout follows a better than expected earnings release from the company. The price gap on our chart (grey square), which accompanies the breakout, shows a strong momentum to the upside move.
17590 becomes the next upside resistance target, while a close below gap support at 15880 would indicate a failure of the suggested move higher.
Truworths Group Ltd
The chart of Truworths is similar to that of sector companion Mr Price, in that we have had a bullish breakout from a flag continuation pattern (highlighted blue). However the breakout is not seen to have the same conviction as that noted in the Mr Price scenario.
With this in mind our initial target is more conservative, located at the short term high of 4200. Traders who are long might use a close below 3715 as a stop loss consideration for the trade.
Foschini Group Ltd
The upward price trend for Foschini persists, with the next upside target considered at gap resistance between levels 11230 and 11500.
However, for now we perceive the upward momentum to be weak. This is noted by the lows which are overlapping the highs as denoted by the 1. – 2. and 3. – 4. markings on our chart. The overlapping of lows and highs is commonly referred to as a creeping trend and questions the short term sustainability of the move higher.
While a long bias is maintained in line with the uptrend in place, traders may prefer to look for long entry on a pullback towards the confluence of support at the 9270 level.
This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
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