Harmony Gold: Analysis of the Daily Time Frame
- Lester Davids
- 2 days ago
- 7 min read
Research Notes December 2025 > https://www.unum.capital/post/rdec2025
Trade Local & Global Financial Markets with Unum Capital.
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Related Notes: https://www.unum.capital/post/har0412
Highlights
Perfect Equilibrium: Harmony Gold is currently displaying a rare technical signature: all four momentum indicators (Ultra Short, Short, Mid, and Base Term) are perfectly synchronized within the "Neutral" zone. This indicates a state of complete market balance between buyers and sellers following the recent volatility.
The "Coiled Spring": This universal neutral alignment suggests that the market is in a highly compressed state. The entire trend structure has reset its energy, and the subsequent directional breakout is likely to be sharp and high-velocity, regardless of the chosen direction.
Structural Trend Defense: The Base Term (14-Period) trend successfully held its ground within the "Neutral" tier during the recent volatility. This confirms that the underlying medium-term uptrend, which began earlier in the year, is still technically sound and resilient.
Key Pivot Point: The price is sitting directly on the 32,500c - 33,000c pivot zone. The resolution of the momentum compression will determine whether the stock challenges the previous cycle high or reverts to lower support.
Best Action Timeline/Price Action Probability
1-2 trading sessions: 60% Probability of Continuation of Consolidation. The market will likely remain compressed between 32,500c and 33,500c, waiting for the first indicator to break its neutral boundaries.
3-5 (1 Week) trading sessions: 70% Probability of Directional Breakout. The indicators are too coiled to stay neutral for long. Watch for the Ultra Short Term indicator to break decisively above 65 (Bullish trigger) or below 35 (Bearish trigger).
6-10 (2 Weeks) trading sessions: 65% Probability of Sustained Trend. The Base Term momentum will likely be dragged by the faster indicator, confirming a sustained move either toward 35,000c or 30,000c.
🟢 Bullish Scenario: Breakout Confirmation: The Ultra Short Term indicator breaks above the "Strong" threshold (65+), forcing price to clear 33,500c. This resolves the coiled spring dynamic to the upside, targeting 35,000c.
⚪ Base Scenario: Extended Compression: The stock holds tight between 32,500c and 33,500c. Momentum indicators remain locked in the Neutral zone for another 3-5 sessions, delaying the major directional decision.
🔴 Bearish Scenario: Compression Failure: The Ultra Short Term indicator breaks decisively below the "Weak" threshold (35), signaling a failure of the recent high. Price slices through 32,000c, leading to a sharp flush toward the 30,000c psychological support.
Momentum Profile (Daily Focus)
The entire momentum structure is in a state of Equilibrium, with all four proprietary trend tiers indicating NEUTRAL conditions:
Ultra Short Term: Indication: NEUTRAL. Slope: Flat.
Short Term: Indication: NEUTRAL. Slope: Flat.
Mid Term: Indication: NEUTRAL. Slope: Flat.
Base Term: Indication: NEUTRAL. Slope: Flat.
Core Thesis Harmony Gold is currently paused in a perfect state of equilibrium. The setup is highly volatile, offering no immediate directional bias but signaling a significant move is imminent once the Ultra Short Term momentum breaks its neutral floor. This is a setup requiring patience and strict adherence to breakout levels.
Key Actionable Zones
Immediate Resistance: 33,500c (Recent High / Breakout Trigger).
Critical Pivot: 32,500c (Current Consolidation Base).
Major Support: 30,000c (Psychological Round Number).
Trend Floor: 29,000c (Structural Low).
Trading Notes/Resources (Where Applicable)
READY TO TRADE: ACTIONABLE AREAS: For active traders who look to generate cash flow on a continuous basis, determining the ‘next best probability’ level to execute against may be of immense value. The blue and red horizontal lines on the chart represent a next best probability buy re-entry range and a next best probability sell re-entry range over the short term. The ranges assume no existing position being held by a trader while the probabilities are based on several factors which may include: short term rating, medium term regime, momentum, horizontal or diagonal support/resistance, candle structure, moving averages and standard deviation, among others. These are short term levels and may be in contrast to medium and long term outlooks which are based on the weekly and monthly charts and, which may be applicable to long term investors. These levels are subject to change based on sentiment, the subsequent price action and company/sector specific or macro news flow. As always, while the levels are outlined, traders should be prepared to adjust in real-time based on the aforementioned.
"Strategy Alerts" help clients identify trading opportunities. When a ticker's real-time or pre-market price action aligns with the criteria on a slide—such as a pullback to the 21-day EMA or a breakout from a consolidation base—it effectively "matches" that stock to the strategy, triggering an alert to a potential trading opportunity. This approach transforms the playbook into a dynamic scanning tool, allowing you to instantly categorize active stocks by the specific technical thesis playing out, ensuring that every trading potential opportunity communicated is backed by a predefined, actionable setup.
THE TACTICAL TRADING GUIDE (PRICE ACTION MODEL): UNCOVER OPPORTUNITIES & ASSESS REWARD-TO-RISK
It helps helps clients determine and shed light on the some of the following:
The CURRENT TECHNICAL POSITION and a PRICE ACTION PROBABILITY for multiple time frames.
Three (3) ‘trading’ time frames are considered: Short Term (1 to 10 days) / Medium Term (2 to 4 weeks) and Long Term (5 to 8 weeks)
Whether the reward-to-risk is attractive for a buy/long position
Whether a share is weak. In this case, wait until the price stabilizes before looking to enter (i.e. want until it stops going down)
Whether aggressive buying is underway. In this case, do not ‘chase’ (do not buy) but instead wait for a pullback to re-enter a buy or an overextension with deteriorating candle structure to sell/short.
Whether a trader can look to buy a pullback into a key moving average (continuation trade)
Whether a share needs to break a range for a new trend to be determined (bullish or bearish)
Whether a traders needs to monitor for a change of character that could lead to a bullish or bearish reversal
Whether a share could start a consolidation phase or before continuing it’s bullish or bearish trend
Whether the upward momentum is slowing (if it's in a bullish phase)
Whether buyers can look to 'phase in' to a position (if it's in a bearish phase)
Whether a share lacks directional bias.
The data set is available in real-time (on request)
The readings are subject to change as the price action develops.
TRADING TIP # 1 Let The Candle Confirm
Out of all those available, Candlestick Charts are the most widely used when it comes to analyzing price from a technical perspective. The interpretation thereof helps traders to understand the interaction between market participants and informs who is in control between buyers and sellers. Various types of candle formation convey key information about the range of outcomes for a share for example, following a downward trend, a long lower tail, doji, piercing or bullish engulfing suggests that buyers have started to become active/started to take an interest while following an upward trend, a long upper tail, doji, dark cloud cover or bearish engulfing suggests that sellers have started to become active/started to take an interest. While information is conveyed pre-market, it is the intraday price action that will confirm any trade or opportunity. While we have a plan, we are also ready to switch gears as the price action develops.
TRADING TIP # 2: Failure & Reclaim
FAILURE to hold a prior session high/range high may signal that the upside momentum is slowing and that an opportunity to short/sell may be at hand. This is often reflected via a deteriorating candle structure which suggests that sellers are starting to take control. Examples of such candles are long upper tails, doji's, dark cloud covers, bearish engulfing candles etc. RECLAIMING a prior session low/range may signal that the downside momentum is slowing and that an opportunity to buy may be at hand. This is often reflected via a improving candle structure which suggests that buyers have started to enter and are looking to take control of the price action. Examples of such candles are long lower tails, doji's, piercing candles, bullish engulfing candles etc.
TRADING TIP # 3: Take Note of the 'Igniting Bar'
This is a large green or red candle which suggests that traders should: TAKE NOTE note of the change in characters and potential change of the trend. TAKE NOTE of a potential acceleration of the trend. TAKE NOTE of potentially aggressive buy or selling Often, BIG MOVES start with BIG MOVES.
Core Trading Principles: Short and Medium Term
Trade with the primary trend.
Volume Matters. This represents the interest of large institutional investors who have the ability to move a share, both up and down.
Do not short/sell a share that is above, and in close proximity to it’s rising 8 and 21-day moving averages. This trend can persist for an extended period.
Ultra short term traders, if a share has advanced strongly over a 3-7 day period, book profits. You can always re-enter and do the same trade at lower levels.
If a share is printing a large bullish (green) candlestick following an extended move, use the strength to sell. The likelihood that the share retraces is high.
If a share is printing a large bearish (red) candlestick following an extended move to the downside, use the weakness to start a long position. The likelihood that the share rebounds is high.
Trade in the direction of the 20-day moving average, using the MA as a level to enter as well as a hard break thereof as a trailing stop-loss.
The 8 and 21-day moving averages often act as support and resistance levels. When they are turning down, use them as levels to sell into. The opposite applies when they are turning up.
The first back-test and undercut of the 50/75-day exponential moving average range has a high probability of holding as support or resistance. Buy or sell it for a 1-3 day move to generate cash flow.
Stocks above a rising 200-day moving average spend the majority of their time trending higher. The opposite applies when the 200-day is trending down.
Previous support can turn into resistance and previous resistance can turn to support. Use these zones as levels to trade against.
Support and resistance levels and key moving averages are ranges rather than exact levels. They often overshoot these zones before occasionally reversing at these levels.
Respect the FIB (Fibonacco) retracement zones. They often act as support and resistance levels.
‘PAY-tience Pays’, however be nimble to react to opportunity to cut when a trade hasn’t been working.
Above all, know your time horizon.
Lester Davids
Senior Investment Analyst: Unum Capital
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