Share tips and stock recommendations for the Australian (ASX) share market – buy, hold, and sell. Michael Gable is an expert guest commentator for the stock market newsletter thebull.com.au.
This post is an extract from the newsletter dated 16 April 2018. You can access the full version of the article HERE.
RHC is retesting the lows from 2017 in the form of a “falling wedge”. This often signifies a reversal of a downtrend. With the P/E coming back to levels not seen in years, we expect buying to come in right here and lift RHC back towards $70
We have waiting for lower levels on the banks for a number of months now and the big 4 have finally all hit our downside targets. They are now finding support at the right levels and therefore represent a buying opportunity. Of the banks about to go ex-dividend, WBC looks particular strong on the chart.
We had previously been looking at levels close to $28 to buy BHP. Now that we have done that, we are still comfortable with where it is heading to from here, that is, the mid $30’s. BHP therefore is hold until we see those upside targets.
XRO has been a great trading stock for us in the last year and despite it recently making a new high for the year, we still rate it as a hold. The charts indicate that the shares are on course to rally towards $40.
When APT was near $7, we warned our newsletter subscribers that it would fall towards $5.50. Price action remains bearish for APT and we have lowered our targets further to $4.80. Any rallies in APT are an opportunity to sell.
Price action remains weak for ORE with volume increasing on the way down. It may bounce towards $5.50 in the short term, but at this stage, looking at the technicals, we can see levels back to the low $4’s being achieved in the next few months.
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You can learn more about technical analysis in this article.
Michael Gable is managing director of Fairmont Equities.
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