For the last few years, we have avoided the mining services sector. Because of this cautiousness, we have managed to save our clients a lot of money as share prices plummeted. Despite the nice gains in the last 6 months, Monadelphous (MND) is still well down from its all time highs. Looking at the chart though, we have seen a trading opportunity develop over the last few days.
We are most comfortable when both fundamentals and technicals look attractive, so this would not suit all of our clients. But some traders may wish to have a quick trade with MND because of the nice charting pattern. Traders just need to know where to place their stops.
MND has been forming an ascending triangle over the last few months. A few days ago we got a buy signal as it broke through resistance near $8.Since then it has continued to push higher. We could get a retest back near the low $8’s and that would be the second chance for traders to go long MND. As long as it holds that breakout level near $8 (which is where you should consider placing your stops), then we would expect to see it trade up towards an initial target near $9.50.
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