CBA Uptrend Intact

This story features COMMONWEALTH BANK OF AUSTRALIA. For more info SHARE ANALYSIS: CBA

By Michael Gable 

Last week’s rate cut was expected, but the market response caught many off guard. The fact that the market was quite elevated for a while always brought a risk of “buy the rumour, sell the fact” but one must understand the positive implications for the rest of the year and not get caught up in the short-term scare mongering – especially when it comes to stocks like the big four banks. They have been sold off recently and we look at the chart of Commonwealth Bank ((CBA)) in today’s report.

The overall market should find support thereabouts at current levels. You may recall that we did expect levels of around 5650 for the market several weeks ago. Admittedly, we did become a little less bearish over the last few weeks, but the fact that the market found levels that we previously calculated as support means that we are probably seeing a low of some sort here.

 

CBA went on a nice run earlier this year before pulling back. We have noticed that this weekly chart shows it to be back towards the previous swing high which should provide it with some solid support. Over coming weeks, CBA should level around here and resume the uptrend, possibly making a new high before the end of the year as it continues to make higher highs and higher lows.

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Michael Gable is managing Director of  Fairmont Equities (www.fairmontequities.com)

Michael assists investors to achieve their goals by providing advice ranging from short term trading to longer term portfolio management, 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 (No. 376892) and Fairmont Equities Pty Ltd is a Corporate Authorised Representative (No. 444397) of Novus Capital Limited (AFS Licence No. 238168). The information contained in this report is general information only and is copy write to Fairmont Equities. Fairmont Equities reserves all intellectual property rights. This report should not be interpreted as one that provides personal financial or investment advice. Any examples presented are for illustration purposes only. Past performance is not a reliable indicator of future performance. No person, persons or organisation should invest monies or take action on the reliance of the material contained in this report, but instead should satisfy themselves independently (whether by expert advice or others) of the appropriateness of any such action. Fairmont Equities, it directors and/or officers accept no responsibility for the accuracy, completeness or timeliness of the information contained in the report.

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