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 30 October 2023. You can access the full version of the article HERE.
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WHC recently announced the purchase of BHP’s coal assets and this is a big positive for the business. On a charting perspective, we have seen the stock break above a major resistance level near $7.50 and this means that we should see WHC trend higher again from here.
Despite the war in the middle east, we expect gold prices to head higher anyway due to factors such as falling bond yields and a falling US dollar. With gold on the cusp of a major upside break, EVN remains our preferred pick in the sector to capture these higher commodity prices.
We remain attracted to uranium’s longer-term prospects here as a lack of supply is starting to meet increased demand. From a charting perspective PDN had spent nearly two years forming a large bull flag. It finally broke free of that several weeks ago and this means that it should trend higher from here.
The recent concerns that weight loss drugs such as Ozempic can impact ResMed’s business appears overdone in our opinion. When we analyse the recent price action, it appears as though large buyers are stepping in here and the stock seems to have finally found a low and is ready to recover from here.
WBC is one of the weakest of the banks. In terms of share price action, it recently rallied back to underneath of its long-term downtrend line and then turned lower again. The stock is therefore vulnerable to maintaining its long-term downtrend, especially once it pays its dividend in November.
We expect earnings to be under pressure and the stock is already expensive due to investors rushing into defensive stocks. The share price is trending lower and price momentum is therefore negative and skewed to the downside.
Michael Gable is managing director of Fairmont Equities.
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