Soon Time To Buy BHP, Rio?

This story features RIO TINTO LIMITED. For more info SHARE ANALYSIS: RIO

By Michael Gable 

Last week didn’t see the market do much, but it still resulted in a bit of a sell-off last Thursday leading into the long weekend. Chinese manufacturing PMI came in at 50.9, the largest we’ve seen for 11 months, and bucking that small downtrend from the last few months. The figure was below expectations but it still confirms that the economy is expanding – at a sustainable rate. I think that is key. If we received a figure well above expectations, then the market could interpret that as the need to tighten the screws again.

On that note, I finally think that it is worth dipping the toe in the water with BHP Billiton ((BHP)) and Rio Tinto ((RIO)). I can’t rule out some medium term weakness, but at the very least I expect some sustained buying to start any day now with those two. Have a look at pages 5 & 6 for the upside targets.

ASX 200

My targets remain the same on the XJO (ASX 200) with support down at 4880, and the next level down at 4570. This weekly chart highlights the text book reversal signal that is now evident. Unless we get an amazing rally this week to take us to new highs for the year, the probabilities are clearly still to the downside.
 

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Visit Michael Gable's website at  www.michaelgable.com.au/.

After leaving Macquarie Bank's Securities Group in 2008 after many years of service, Michael has gained a highly regarded reputation in the financial services industry. As a Private Client Adviser with Novus Capital, Michael has become a popular live commentator and analyst for Sky News Business Channel’s “Your Money, Your Call” program. He is also the author of the weekly stock market report “The Dynamic Investor”.

Michael assists investors to achieve their goals by providing advice ranging from short term trading to longer term portfolio management.

Michael deals in all ASX listed securities and specialises in covered call writing to help long term investors protect their share portfolios and generate additional income.

Michael is RG146 Accredited and holds the following formal qualifications:

• Bachelor of Engineering, Hons. (University of Sydney) 
• Bachelor of Commerce (University of Sydney) 
• Diploma of Mortgage Lending (Finsia) 
• Diploma of Financial Services [Financial Planning] (Finsia) 
• Completion of ASX Accredited Derivatives Adviser Levels 1 & 2

Disclaimer

Michael Gable is an Authorised Representative (Rep. No. 376892) of Novus Capital Limited AFSL 238168 ACN 006 711 995. Michael Gable and Novus Capital Limited, their associates and respective Directors and staff each declare that they, from time to time, may hold interests in securities and/or earn brokerage, fees, interest, or other benefits from products and services mentioned in this website. This website may contain unsolicited general information, without regard to any investor's individual objectives, financial situation or needs. It is not specific advice for any particular investor. Before making any decision about the information provided, you must consider the appropriateness of the information in this website or the Product Disclosure Statement (PDS) or Financial Services Guide (FSG), having regard to your objectives, financial situation and needs and consult your adviser. Any indicative information and assumptions used here are summarised and also may change without notice to you, particularly if based on past performance. Michael Gable and Novus Capital Limited believes that any information or advice (including any securities recommendation) contained in this website is accurate when issued but does not warrant its accuracy or reliability. Michael Gable and Novus Capital Limited are not obliged to update you if the information or its advice changes. Michael Gable and Novus Capital Limited and each of their respective officers, agents and employees exclude to the full extent permitted by law, all liability of any kind, in negligence, contract, under fiduciary duties or otherwise, for any loss or damage, whether direct, indirect, consequential or otherwise, whether foreseeable or not, to the extent arising from or in connection with this website.

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