Time To Switch?

This story features RIO TINTO LIMITED, and other companies. For more info SHARE ANALYSIS: RIO

By Michael Gable 

I spoke last week about BHP Billiton ((BHP)) and Rio Tinto ((RIO)) to start seeing some sustained buying to bring them off their lows. That has definitely started happening here with BHP now (which is yielding more than the RBA cash rate now at 3.5%). I may have been a week early with RIO but it looks to me as though it will start its relief rally today. Other stocks that could snap back quite nicely from current levels include Atlas Iron ((AGO)) and Western Areas ((WSA)). In today’s report I have also covered off on Medusa Mining ((MML)) and Boart Longyear ((BLY)) which are other trading ideas on the long side.

Calling a correction in the banks has been almost impossible recently as they relentlessly edge higher, but I am going to attempt it again. In this week’s report I have had a look at Commonwealth Bank ((CBA)), National Bank ((NAB)), and Bank of Queensland (( BOQ)) and have provided the levels where I think they can fall to over the next several weeks and where I feel they can be a buying opportunity. There should be a decent amount of money coming back into the market this year so I don’t expect a big fall to happen.

In terms of the overall market, the XJO (ASX 200) hit my first downside target last week, so read on to find out where I think it could possibly head from here.

ASX 200

The XJO, give or take a few points, fell into my 4880 target last week. As such, I am expecting the market to rally from here. Initially I am looking for levels up towards 5000 – 5050. However, I am open to the idea that a failure of the market to go to a new high will see it fall back to a low of about 4750 or even 4570 as a worst case scenario. If that low does eventuate, then I am anticipating it to happen in early June.
 

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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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