Technicals | Oct 10 2023
By Michael Gable
In the past few days, share markets here and in the US became oversold and then found very good support and look as though they will recover from here.
Today's report has an updated chart on the S&P/ASX200 Index (XJO). We continue to like resource stocks at current levels. This includes gold and energy.
The current conflict in the Middle East is causing oil and gold prices to spike higher, so it makes it hard to chase those in the short-term. But longer-term, for reasons unrelated to the current events, we can see energy and gold stocks heading higher.
When we last looked at the XJO at the end of September, it was finding good support near 7000.
However, after breaking that last week, it then found itself retesting the March lows. It briefly undercut that low before bouncing strongly.
This "failed break" is a good sign. It also coincides with the daily RSI becoming oversold and bouncing to trigger a buy signal (circled).
The same signal occurred in March which led to a rally in the index. Current levels of the index remain a buying opportunity.
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
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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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