Technicals | Apr 12 2016
By Michael Gable
The market continues to lack enough conviction to move stocks in any one direction for any one amount of time long enough, with the uncertainty seems to be extending its reach across markets and putting investors on the defensive. US earnings expectations loom as the next hurdle for a market already on the back foot, with a growing number of analysts expecting the largest drop in earnings since the global financial crisis.
Contributing to recent weakness in the S&P/ASX 200 Index, banking stocks remain out of favour against the backdrop of rising bad debts, higher funding costs and uncertainty around housing markets and future capital requirements. In the last week, ANZ has lost 2.5%, with CBA, NAB and WBC shedding 3%, 3.5% and 4.3%, respectively.
Nonetheless, we are always looking for opportunities and in today’s report we include a chart on Westfield Corporation (WFD), which looks interesting.
After a great run in 2014, WFD has been tracking sideways for the last year – which is a good performance considering the overall market. It seems to be neatly range-bound within what appears to be a symmetrical triangle. It has already made four movements within this pattern and usually the 5th will see it only come back half way in the range before it makes a final attempt to an upside breakout. Therefore these levels between $9.50 and $10 will represent a chance to pick up WFD before it makes a possible final attempt at breaking to the upside and striving towards $11.
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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
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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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