AGL Energy Shares Eyeing $12 Target

This story features AGL ENERGY LIMITED. For more info SHARE ANALYSIS: AGL

By Michael Gable 

We are in the final week of the financial year, where we witness the usual volatility due to quarter-end re-balancing and tax loss selling.

Our observation is that most of time we don’t see all sectors of the market heading in the same direction for periods – as much as we would all like that to happen, however. Locally, our market tends to operates in two speeds where the heavyweights of banks and resources tend to take turns of moving higher – which is why our market can feel frustrating at times.

In the US, we are witnessing a move higher in a handful of tech stocks at the expense of everything else. The concern on the street is that a drop in these tech stocks will be diabolical for the market. The same concerns were being expressed at the end of 2023, but we noted at the time that if/when the tech stocks cool off, money will just flow back into resources, healthcare, and other sectors of the market.

In the case of the S&P500 Index, it should lead to shallow pullbacks, not deep corrections. This is what we have seen so far this year and we don’t expect that to change. That is, when investors decide to take some money off the table in US tech, it will flow into some of the recent laggards. And stocks that look to be hopelessly broken coming into 30 June will look very interesting again in early July.

We offer a technical view on AGL Energy ((AGL)).

After recovering earlier in the year, AGL then spent much of May and June trading sideways in a tight rectangular range to consolidate the move. Volumes were also low, which was a positive.

The stock has now broken free of that range (circled) on an increase in volume. This breakout is a buying opportunity for those looking for a short-term trade.

There will be some resistance just above $11, but ultimately, we would be targeting $12 and the gap created in August.

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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