Pos­i­tive shift in sen­ti­ment

Finweek English Edition - - Marketplace Killer Trade - By Mox­ima Gama

eOH of­fers a range of in­for­ma­tion tech­nol­ogy ser­vices, soft­ware, IT in­fras­truc­ture, in­dus­trial tech­nolo­gies and out­sourc­ing so­lu­tions. It op­er­ates in over 50 coun­tries.

When EOH failed to ex­ceed its first top at 18 000c/share in De­cem­ber 2016, af­ter years of strong growth funded with shares, it grad­u­ally dropped to 2 335c/ share – lows last seen in 2012.

Al­le­ga­tions of gov­ern­ment ten­der ir­reg­u­lar­i­ties, which the com­pany flatly de­nies, as well as the sud­den res­ig­na­tion last year of long-time CEO and founder Asher Bo­hbot, shocked the mar­ket.

The com­pany was ex­pected to re­lease its re­sults for the year to 31 July 2018 on 3 Oc­to­ber, as this edi­tion of fin­week went to print. Out­look: EOH has re­tained firm sup­port at 2 655c/share and seems to be bot­tom­ing-up within its long-term bear trend – po­ten­tially spurred by the com­pany’s over­haul strat­egy. Share­hold­ers are also wel­com­ing the ap­point­ment of Stephen van Coller as CEO – he was pre­vi­ously MTN Group vice-pres­i­dent for dig­i­tal ser­vices, data an­a­lyt­ics and busi­ness de­vel­op­ment. On the charts: The com­pany’s share price is edg­ing closer to the re­sis­tance trend­line of its longterm bear trend. If an­other ris­ing bot­tom forms above 2 655c/share, fur­ther gains may be in the off­ing. Go long: A good buy sig­nal would only be trig­gered through 5 500c/ share – above that level EOH would also con­firm a pos­i­tive break­out of its long-term bear trend. Gains to next re­sis­tance at 7 745c/share should then fol­low. If up­side mo­men­tum were to per­sist af­ter the break­out, EOH could retest the 11 750c/share level in the short to medium term.

Go short: Do not go long if EOH should fail to breach the blue bold trend­line – the share price could fall back to 2 655c/share.

The bear trend would ex­tend through that level, to­wards 1 800c/share. ■

SOURCE: ShareNet

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