Trade Idea: Buy AVI Ltd

Trade the AVI with Unum Capital.

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

For clarity, the following is the text on chart below:

This trade idea is linked to the previous note on AVI (Trading AVI: Long/Short, Thursday 06 February 2025). Thesis: HIGH RISK BUY IDEA therefore small-than-average position sizes may apply. The share has been sold off aggressively and is in a high bearish momentum regime while also approaching an oversold range. I do NOT think that THIS is the exact low (i.e. I am expecting lower levels) however, this may be a RANGE to starting building a buy/long position with the expectation that a base starts to form over the near term followed by a potential bullish reversal. Buy at current levels or lower (traders could consider starting with a 1/3 of the position). In terms of probabilities, it's possible that the share could trade down to the 8700c range (this is NOT a prediction, but merely a probability based on candle structure, momentum etc.). Note the 8700c level coincides with the unfilled gap which was created on 18 June. As always, traders could consider the following if/when the prices approaches the target: bank/take profit, partially scale out, adjust the stop-loss to protect profits. Note: Event risk in the form of earnings are expected on 10 March. Time stop: 11 July 2025.

Trading Levels:

Consider 9040 down to 8840c as a range

Based on the above, use a stop-loss of 8350c.

Target: 10200c

Last Close: 9202c

Chart as above (enlarged):

This share has given traders opportunities on both the long (buy) and short (sell) side, both of which we have discussed.

We called the overbought conditions pre-market on 11 November. This was the same day which it peaked at 12500c. A few days before that (06 Nov), the time-stamped price action model alerted us to expect a retracement/pullback (scrolls further down to see).

As of yesterday's close, this is worth noting:

Approaching prior swing lows
Has ALREADY experienced an aggressive short term sell-off, which appears to be near the tail end.
The model is alerting that the reward-to-risk is becoming attractive for a small buy/long position however, we should wait for the lower time frames to stabilize.
I am expecting: (1) the share to trade lower, but to potential reclaim the prior session or range lows, build a base, then develop a short term bullish reversal.
As of yesterday's close, this is what the model said:

Previous Post: AVI LTD Strong Rejection At Multi-Year Swing Highs. Well Done, Short Sellers

This is an updated chart which reflects the price reaching the pre-determined sell range (R123), which was followed by a strong bearish rejection down to R102. Well done, short sellers.