Breakout For GUD

This story features G.U.D. HOLDINGS LIMITED. For more info SHARE ANALYSIS: GUD

By Michael Gable 

Much has already been said about the US market and the return to the good old days when it can also go down sometimes. When good news is sometimes bad news. To throw in our 2c, it is a rare occurrence to see a big market sell-off straight from a previous peak. If we are to see it have a significant correction of 15 – 20% or more, there will likely be a bit more of a tug of war between the bulls and bears. After a few weeks or so of that, if it is going to fall significantly, then it will happen. That is our opinion on how it would play out, which means that it will fall from higher levels than where it is today.

Otherwise we might just see a bit more a quick sell-off here with the S&P 500 Index falling another 100 points and the Dow Jones about 800 points as they fall towards the long-term uptrend and then get back on with edging higher.

With the benefit of hindsight, the US markets appear to have gone up a bit too vertically during the last few months and we are now seeing a bit of a blow-off to bring it back to a more sustainable trend. This would bring the US markets back to levels not seen since October last year.

Moving onto the opportunities, GUD Holdings ((GUD)) reported well last week and we cover that here today and believe it is an opportunity to buy on weakness.

Our last charting comment was on 21 November when we noted the positive way GUD had been trading and our target was for levels above $13 before reassessing. With volume now coming in on the back of a good first half result, we now expect the shares to continue trending higher into the high $13's. Support levels remain near $12.50 and $12.

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)

Fairmont Equities is a share advisory firm assisting Private Clients with the professional management of their share portfolio. We are based in the Sydney CBD but provide services to private clients across Australia. We believe that the concepts of fundamental analysis and technical analysis of stocks are not mutually exclusive. Regardless of whether you are a trader or long term investor, combining both methods is crucial to success. As a result, the unique analysis of Fairmont Equities is featured regularly in the media such as Sky News Business, CNBC, The Australian Financial Review, and the ASX newsletter. Contact us for a free trial of our research and information on our portfolio management services. 

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

Fairmont Equities Australia (ACN 615 592 802) is a holder of an Australian Financial Services License (No. 494022). 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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