This JSE Mining Share is Trending Strongly, But 'Overbought' in the Short Term

Lester Davids
Jan 6
2 min read

Research Notes January 2026 > https://www.unum.capital/post/rjan2026

Trade Local & Global Financial Markets with Unum Capital.

To get started, email tradingdesk@unum.co.za

Trading Anglo American Plc: Running +34% + Current Price Action Model

Currently higher by 34% from our video on 26 August in which we discussed the R527 level as a trigger. Now trading in a short term 'Overbought' regime.

Analyst's Price Action Model (Max = 5 to 8 week view)

Regime: Very Bullish / Overbought

Primary Outlook: At or approaching sell/reduce

Executive Summary

Anglo American is currently in a powerful, vertical move with "Very Strong" buyers firmly in control. However, the model issues a critical warning: "Don't Chase." The stock has reached an "Overbought" 7-day trend status, and the probability of a failure to hold these highs is elevated. The setup suggests the easy money on the long side has been made, and the risk/reward now favors a tactical pullback or mean reversion trade.

Detailed Trend Analysis

1. Short-Term Dynamics (1 - 10 Days)

7-Day Trend: Overbought
14-Day Trend: Very Bullish
Outlook: Very Strong Move / Buyers In Control.
Analysis: The market is running hot. While the trend is undeniably up, the explicit instruction is to avoid new long entries. The move is extended, and the "Overbought" reading suggests the rubber band is stretched too far.

2. Medium-Term Structure (2 - 4 Weeks)

Status: Very Strong Move (Risk of Exhaustion)
Analysis: The guidance is identical across all timeframes, reinforcing the singularity of the current condition. The stock is likely at a climax point where it may "Fail At Attempt To Hold The Highs."

3. Long-Term Trajectory (5 - 8 Weeks)

Status: Buyers In Control
Analysis: Even on the longer horizon, the advice remains tactical: the 8-EMA is identified not just as support, but as a "Short/Sell Target" if the highs fail to hold. This implies a correction back to the mean is expected.

Strategic Action Plan

Primary Strategy: Fade the Failure (Mean Reversion).
The Warning: Do not buy at current levels ("Don't Chase").
The Trigger: Watch the current highs. If price pushes up but fails to sustain the level (a "look above and fail"), it signals exhaustion.
The Trade: If the highs fail, the setup is a Tactical Short targeting a reversion back to the 8-day Exponential Moving Average (8-EMA).