Short Term Rally For Fortescue

This story features FORTESCUE LIMITED. For more info SHARE ANALYSIS: FMG

The company is included in ASX20, ASX50, ASX100, ASX200, ASX300 and ALL-ORDS

By Nick Linton-Ffrost

Rally to 3.90 before pullback

We suspect Fortescue Metals ((FMG)) will trade towards 3.90 over the next two weeks before pulling back to around 3.50.

Our view is based on the assumption that FMG is trading within an “abc” rally which is correcting part of the decline from 5.00 to 3.20. We suspect the last two weeks trading has carved out a “zig-zag” pattern (b wave) which implies a bounce towards 5.90 (where wave c=a).

Trading above 3.50 for more than 2 days should be enough to trigger a buy while 2-3 days trading below 3.35 negates our view.

Trading tactics

Open longs with after two closes above 3.50 using a 3.57 limit placing stops at 3.35 and looking for 3.90.
 

Another trading idea from

Fifth Wave | fwtc.com.au                                               

FW generates over 150 Trading Alerts on the ASX100 each year. We are a subscription service specialising in short term technical strategies based on 27 years experience.

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