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This story features NORTHERN STAR RESOURCES LIMITED. For more info SHARE ANALYSIS: NST

By Michael Gable 

It was quite timely that we gave an update on gold last week and reaffirmed our views that it actually looked positive overall, not as bearish as many analysts were now turning. The news last Friday that US employment grew at the slowest pace in nearly six years put the prospects of June rate rise off the table in the US and put a rocket under the gold price.

Our tip five weeks ago on getting out of Evolution Mining (EVN) for a 37% return and getting into St Barbara (SBM) paid off with SBM now up 23.3% since that recommendation. We have to admit to being a little surprised at how much it pushed on yesterday into the close, but beyond some short-term weakness, it should head higher with the price of gold. We have also taken the liberty to look at the chart of another gold stock, Northern Star Resources ((NST)).
 

We are seeing a textbook trend in NST as it continues to head higher and higher. The stock had a couple of flat corrections in 2015 and you will notice on the chart that they sat nicely on top of the previous highs, which is a positive sign. Then the correction earlier this year managed to create a bit of space to the 2015 high which suggests a pick-up in momentum now. The recent pullback from the last few weeks also created a gap to the previous peak on the chart. Not only that, but these corrections are getting smaller and smaller in time. This all bodes well for NST. We cannot pinpoint price targets from here but any slight dips should be bought as NST is likely to accelerate well into the $5.00s over coming weeks.
 

Content included in this article is not by association the view of FNArena (see our disclaimer).
 
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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