Kaz Minerals: Triangle breakout could lead to 700p

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Kaz Minerals: Triangle breakout could lead to 700p

The chart of Kaz Minerals (LON:KAZ) is typical of many contemporaries, in that the past few months have witnessed a consolidation of massive moves to the upside.

One of the big problems with trading is trying to assess whether a bull run has ended or whether we have a dip to buy into. This is being played out as far as the equity market is concerned as a whole, but of course the mining sector is a notoriously volatile and difficult part of this asset space.

The position on the daily chart of Kaz Minerals is that we have just been treated to a major triangle breakout, one which has been blocking the price action since the beginning of the year. The line in question currently runs at 510p, so we are waiting on an end-of-week close above this level today to confirm the break has been made. Should this be achieved, the notional target would be as high as the resistance line projection drawn in from as long ago as the beginning of the year at 700p.

The timeframe on such a move is regarded as being as soon as the next 1-2 months. In terms of what the stop loss on the buy argument may be, only back below the 200 day moving average currently way down at 392p would really kill the bull argument. But a more practical money management point is regarded as being the June 457p floor on an end of day close basis.

KAZ chart

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