The document provides an active trading plan and analysis for the week ahead, covering various global markets, sectors, and stocks. It identifies technical setups and trading opportunities based on chart patterns and recent price action. Key areas discussed include the strong US jobs report supporting the US dollar, weakness in gold and other commodities, mixed opportunities across South African sectors, and long and short setups developing on individual stocks based on technical indicators.

1. Active Trading Plan: Insights & Opportunities
09 & 10 August 2021
Global Market Flash Points
Analyst’s View
The Week Ahead
The Last 48: Newsflow
Trading Commentary and
Strategy: Major Sectors
(South Africa)
US Dollar Index
US 10-Year Bond Yield
USDZAR
Gold/Silver Ratio
Firstrand Ltd
Vukile Properties
Capitec Bank
SA Gold Miners
NextEra Energy
DraftKings
United States Steel Corp
VMWare Inc
Silvergate Capital
Corporation
Euro Stoxx 600 Utilities
Index

2. U.S. Job Growth Tops Forecast With Biggest Gain in Nearly a Year: Payrolls
rose 943,000 in July after upwardly revised June gain; Number of long-
term unemployed falls by most on record: The U.S. labor market charged
ahead in July with the biggest increase in employment in nearly a year,
highlighting optimism about the economy’s prospects even as coronavirus
concerns resurface. Payrolls climbed by 943,000 last month after upwardly
revised increases the prior two months, a Labor Department report
showed Friday. The unemployment rate dropped to a pandemic low of
5.4%, while earnings and hours worked remained elevated. The figures
mark a big step toward the Federal Reserve’s goal of “substantial” further
progress in the job market that will add fuel to the debate on how quickly
officials should begin dialing back their bond buying. Bloomberg
• Fed’s Sanguine Inflation View Tested in New Data: Eco Week
Ahead. U.S. consumer prices probably rose in July at the
slowest pace in five months, marking a deceleration that stops
short of full relief from cost increases weighing on sentiment
and driving political debate.The government’s index is seen
climbing 0.5%, according to the median projection in a
Bloomberg survey of economists ahead of data this week.
Stripping out volatile food and energy components, the core
measure of prices is forecast to rise 0.4% after a 0.9% advance
in June that matched the largest month-over-month gain
since 1982. - Bloomberg

3. Analyst’s View: Trading Commentary and Strategy - Major Sectors (South Africa)
• Diversified Miners | Most names have run hard on the back of earnings and dividend expectations, and are consolidating with
moderate retracements at their highs. It's possible that there was some rotation into banks and retailers on the back of market
updates from NED and WHL. At the last close, not a level for fresh longs to enter as a reward-to-risk unappealing. Bear in mind an
advancing USD which is a negative for commodities.
• Platinum and Precious Metals | Platinum slips below $1000 (not closing above $1063 to trigger a long). The sector counters pulling
back as it struggles to maintain it's recent momentum. SSW weaker than peer group as it continues to hover around it's 200-day
SMA (since mid-June) and where it may close below. Same as above, bear in mind an advancing USD which is a negative for
commodities.
• Gold Miners | A collection of broken charts. The market taken by surprise as Anglogold Ashanti's all-in sustaining costs rise by 33%
YoY, even though net debt was cut by 41%. Share down 12% on the day, with sector peers also seeing selling pressure. With the US
Dollar higher, the added pressure of a lower gold price will continue to weigh on these names, with nearly all of them trading near
1-year lows with potentially vulnerable support zones. Weekly chart of the 4 miners further in the report.
• Retailers | Most sector constituents trading close to their 6 and 12-month highs, with higher highs and higher lows, suggesting
buyers stepping in on each retracement. Woolworths market update spurring further sector buying this past week. Note that some
names are also well-off their recent lows, however excerise caution as it's possible that we see retracements back to consolidation
breakout levels i.e. do not chase following these 8-12% moves higher. Wait for a re-test level to hold and use the turn back up as
confirmation.
• Financials | Similar to other sectors, financials have a been range-bound year-to-date. Remember, we are also in a "Year 2"
enviroment where the thrust higher in 2020 is being followed by choppy range-bound trading in 2021. In this case, you have to take
your profits tactically as retracements happen swiftly. I spoke about SBK on 19/7 as a dip buying opportunity as the civil unrest
concerns continued to play out. Stock now 133 from 116-118 at the time. NED out with an update last week - solid. Dividends
expected for the sector following recommendations by the SARB to halt payouts as a result of COVID-19. Just for some perspective,
banks are +70 to +90% off their March 2020 lows.

4. Analyst’s View: Trading Commentary and Strategy - Major Sectors (South Africa) - Cont.
• Healthcare | Much chopiness here with the exception of APN that's been a great trending trade with initial long idea at R147 and a
follow-up at R163 in prior months. Multi-month high of 18480c seen on Monday (02/08). LHC has a bit more of a bid than NTC as
it's benefitting from the Alzheimers breakthrough (see Biogen in the US). MEI struggling to catch a bid.
• Industrials/Technology | A diversified bunch so I'll only focus on a select few. Starting with NPN/PRX - massively choppy as the
Chinese regulation news continues to weigh. With these two, it may be better (at this stage) to focus on the bigger trend as
opposed to trying to catch swings. If you want to play the intraday ranges, then watch those levels closely, with a nibble approach -
can't stress this enough! Bid Corp: Last buy at 29300c, with fades above 32500c. Still a strong name with a rock solid balance sheet,
but it feels like the momentum is being lost with strong selling each time it trades above 32600c. Remember, although diversified,
it's also exposed to the FMCG/restaurant business where caution will be applied in the face of any surge of Covid cases. That being
said, I would consider a re-buy if it trades close to 29000c again. Sappi still underwhelming. Mondi - market happy with results.
Bidvest - very strong, with big move off the 'looting lows'.
• The Week Ahead (South Africa): Non-comprehensive
• On Monday, SA markets will be closed for a public holiday (National Women’s Day).
• Tuesday, interim results from Merafe. Stats SA releases June manufacturing gproduction and sales data.
• Wednesday, interim results from Nedbank.
• Thursday, Exxaro Resources and MTN Group interim results. Stats SA also releases June mining production and sales data.
• The Week Ahead (International): Non-comprehensive
• Monday: Chinese Inflation Data; German current account data; US Jolt Job Openings.
• Tuesday: Australian NAB business confidence; German ZEW economic sentiment
• Wednesday: US inflation data.

5. US Dollar Index (DXY)
Bid on the back of a strong US
payrolls report. Market has
recent turned ‘net long’ from
being the consensus short at
the beginning of this year.
Gold: Bear flag triggered.
Rejecion off 200-day.
Vulnerable at prior demand/
supply.
Silver
Losing support and rejection at
it’s 200-day. 4-Month low.
Platinum
Strong selling as USD is bid.
US 10 Year Bond
As noted last during last week, the
yield was trading at oversold levels,
close to it’s linear regression channel.
Friday rebound on the back of jobs
report. Bonds down, yields up.
AUDJPY
Range-bound. Stuck at 200-day
SMA. General trend down.
EURUSD
Pair at 4-month, with strong selling
pressure as US jobs see Dollar bid.
Medium term, 1.1700 is a risk level.
Brent Crude Oil
Short/sell with eventual follow-
through. Lower highs (negative).
May consolidate here.
Copper
Broadly range-bound. Strong
supply at 4.40. Strong USD
could cap advance.
Iron Ore
Swift move back to 169.00
following resistance near
220/225. Now around 200-day
SMA. Broken chart.
Volatility Index (VIX)
Closing at 3-week lows. Traders
should consider purchasing
protection below 16.00.
S&P 500 Index
Trend remains higher in the
short term. Will alert if I get a
short signal.

6. US Dollar Index (DXY) | On the back of a strong non-farm payrolls report, the price action in the US Dollar continued short term support for the
currency. Looking out further however and expanding on our Q4 2020 and Q1 2021 views for a stronger greenback, the DXY has been
developing a base above it's 200-day simple moving average since mid-June following an extended downward trend and base below the level
from May 2020. Monthly chart on the following slide.

7. US Dollar Index (DXY, 92.78) | Monthly Chart | Maintaining our view from Q4 2020, we believe this chart remains relevant and
key for a read-through to global markets.

8. US 10 Year Bond Yield (1.30%)
Our analysis over the last 2
weeks suggested highlighted
the oversold nature of the US
10-Year Bond Yield, with the
1.10% to 1.18% level being an
area where we could see a
rebound back to 1.28% and
1.30%. Following Friday's
payroll data, bonds sold off,
meaning yields rose, with a
close at the 1.30% level.
We consider monitoring this
chart as key in the asset
allocation process, with the
direction having wide-ranging
implications across sectors
and asset classes for example,
higher yields benefit financials
but is negative for gold which
has no yield as well as growth
stocks and real estate where
future cash flows are impacted
by the cost of capital.

9. US Dollar / South African Rand (USDZAR, R14.62) | The pair is off it's recent lows, following an oversold rating, with the
rebound from the lows of R14.22 to Thursday's high being driven by changes in SA public sector leadership and an advancing
USD. Note the rebound off the 50-day EMA which is a mostly a strong support following a trend reversal.

10. Gold/Silver Ratio | The ratio reclaiming it’s 200-day SMA and demand supply zone, suggesting gold to potentially outperform
silver on a relative basis.

11. Firstrand Ltd (5729c) | The share has provided numerous tactical, short term opportunities over the past few months, with our research
highlighting mostly those on the buy/long side. Expanding our view and zooming out, we also note the price having developed an ascending
triangle which could see an upward trend continue. The price is above it’s rising 200-day SMA and has cosed near it’s 6, 9 and 12-month highs.
The market is also responding positively to bank sector results. Stop: 5309c.

12. Vukile Property Fund (1145c) | VKE is a strong name with a bullish price structure. It recently tested it’s multi-month breakout level and has
continued to make higher lows. We have also seen the price resume it’s upward trend off the rising trend line and 63-day linear regression
channel, with reclaim of the 20-day and 50-day EMA. Potential target is the top of the linear regression channel with a stop of 1065c.

13. Capitec Bank (CPI, 170863) | My most recent long idea from R1499 on 05 May with target of R1700 reached on 02 June. I'm not
recommending a long here but having reviewed the weekly chart in recent months, I've noticed an inverse head and shoulder technical
formation that has developed, with both a breakout and a back-test that held during mid-July. Shorts, caution.

14. SA Gold Miners | A collection of broken charts. The market taken by surprise as Anglogold Ashanti's all-in sustaining costs rise by 33%
YoY even though net debt was cut by 41%. Share down 12% on the day, with sector peers also seeing selling pressure. With the US Dollar
higher, the added pressure of a lower gold price will continue to weigh on these names, with nearly all of them trading near 1-year lows
with potentially vulnerable support zones.

15. Nextera Energy (NEE, 80.61) Strategy:
Trend Following
NEE is the world's largest producer of
wind and solar energy, with between
$50 and $55 billion in new
infrastructure investments planned
through 2022. It's most recent
earnings report, the comoany
reported a 9% increase earnings year-
over-year while net income came in
at 819m vs 749m. The company also
stated that dividends are expected to
grow by at least 10% through 2022.
Using a trend following approach, we
consider the weekly chart where the
price has broken to the upside of a
triangle consolidation range which
has been in development since
January 2021. More broadly, the
stock has traded in a sideways range
since 05 October, suggesting possible
accumulation over the 10-month
period. The most recent price
advance, which is a series of higher
lows and higher highs suggest buyers
having the upper hand over sellers.
Buy at current levels or better. Stop:
74.20. Target: 97.00. Figures in USD.

16. DraftKings Inc. (DKNG, 51.59) | The stock is back in focus following it's earnings last week where it tops estimates and raised it's guidance for the
full year revenue from 1.21bn to 1.29bn. The company also annouced plans to launch DraftKings marketplace, a digital collectibles ecosystem and
exchange. From a technical charting perspective, the stock has cleared it's downward trend line in place since 26 March while also holding it's
pivot. We also note the 50-EMA being cleared while the MACD is pending for a bullish crossover above the centre line.
Stop: 46.20. Figures in USD.

17. VMWare Inc. (VMW, 157.38) | The Dell Technologies spin-off is setting up with a bull flag that is confirmed above the 160.00
level. Stop-loss: 153.80. Target: 177.00. Figures in USD.

18. Silvergate Capital Corp. (SI, 115.77) | Originally flagged on Thursday during US trading hours at 109.36. The group is a provider of
financial infrastructure solutions and services to participants in the digital currency industry. Multi-month consolidation. Above
$117 would trigger resumption of upward trend. Stop-loss: 106.70. The chart structure very similar to Safehold REIT referred to
on 07 June. Figures in USD.

19. United States Steel Corp (X, 25.91) | Strategy: Trend Continuation | We maintain our positive stance on the sector (globally), albeit without the
expectation of a massive surge in prices. Since our last sector call in October 2020, most names are higher by between 80% and 120%. We see
another opportunity in US Steel for a continuation long as the price is nearing an upside break of a pennant formation. Your long will be a daily
close above the downward trend line, using the recent pivot as a stop-loss, with an open target. More specifically, the provisional levels are entry
are 26.72, stop-loss of 24.45 and a target of 32.67. Figures in USD.

20. Euro Stoxx 600 Utilities Index | The index is potentially gearing up for a change of trend as it tests the downward trend line
extending back to the peak of 08-January. Top 5 constituents: Enel, Iberdrola, National Grid, Orsted, E.ON.

21. The purpose of this non-comprehensive research report and chart pack is to provide traders and investors at all levels with the following:
❶Information: To inform and alert you to high probability technical trading setups which could assist you in generating a profit in the financial
markets.
❷Identification: Identify Key Levels for your exsiting universe.
❸Spark Additional Ideas.For e.g. Share (A) and Share (B) may both be attractive however you may prefer one over the other or an
international stock in the same sector.
❹De-Risk:Our charts may include caution around selected stocks that present downside technical risk, helping you to identify an opportunity
to exit a share and preserve capital in the process.
❺Provide an alternative, holistic cross-asset view that may add to your own process
PLEASE NOTE: This is a pre-market report however our preference is to respond to trading opportunities in real-time, using an opportunistic and
flexible approach as prices may be influenced by additional market data, news (share and peer trading statements and earnings reports) as well
as changes in price action/structure in real-time.
All insights, data and charts are as at the close of Friday 06 August 2021 and represent a best probability plan and perspective. In addition, levels
within this report are subject to change based on the aforementioned while additional ideas/thoughts will follow as the week progresses.
To enquire about any additional names currently on our watch-list, please contact the analyst/trading desk.
Research & Analysis: Lester Davids
Trading & New Account Enquiries: Unum Capital Trading Desk - 011 384 2923 or email tradingdesk@unum.co.za