Looking for signs of a reversal - Close to double bottom
Anheuser-Busch InBev is the leading global brewer and one of the world’s top five consumer products companies. The company is geographically diversified, with a balanced exposure to developed and developing markets. It draws on the collective strength of approximately 200 000 colleagues in more than 50 countries worldwide.
It hasn't been a great two years for Anheuser, after their merger with SABMiller in Oct 2016, in terms of their share price but they have the largest market cap on the JSE at the moment. They have big plans in terms of expansion on the African continent with production having started in Nigeria already and plans to open their first brewery in Mozambique next year as well as talks of closing a deal to build a brewery in Tanzania. A total shipment increase of more than 20% was recorded in the region for 2017 so it stands to reason that the 2018 figures will be promising as well. This combined with the expansion plans, leads me to believe that longer term investment will yield good returns.
Let's have a look at the technicals.
Daily (blue): We only have 2 years of history here but the setup looks good for some movement to the upside. According to my analysis, we are in wave 4 on the daily time frame. Price is trading close to previous lows so I am on the lookout for signs of a reversal which will indicate the next move up on wave 4.
H4 (green): With price trading very close to the previous low and coming off the bottom of the larger daily structure, I believe that wave 3 on the H4 time frame will start soon. I will be looking to trade wave 3 back to the top of the daily structure. AT that point I will need to look for confirmation of a break to the upside on the daily structure or alternatively a move down to complete wave 5 first.
It hasn't been a great two years for Anheuser, after their merger with SABMiller in Oct 2016, in terms of their share price but they have the largest market cap on the JSE at the moment. They have big plans in terms of expansion on the African continent with production having started in Nigeria already and plans to open their first brewery in Mozambique next year as well as talks of closing a deal to build a brewery in Tanzania. A total shipment increase of more than 20% was recorded in the region for 2017 so it stands to reason that the 2018 figures will be promising as well. This combined with the expansion plans, leads me to believe that longer term investment will yield good returns.
Let's have a look at the technicals.
Daily (blue): We only have 2 years of history here but the setup looks good for some movement to the upside. According to my analysis, we are in wave 4 on the daily time frame. Price is trading close to previous lows so I am on the lookout for signs of a reversal which will indicate the next move up on wave 4.
H4 (green): With price trading very close to the previous low and coming off the bottom of the larger daily structure, I believe that wave 3 on the H4 time frame will start soon. I will be looking to trade wave 3 back to the top of the daily structure. AT that point I will need to look for confirmation of a break to the upside on the daily structure or alternatively a move down to complete wave 5 first.