Pinnacle Offers Buying Opportunity

This story features PINNACLE INVESTMENT MANAGEMENT GROUP LIMITED. For more info SHARE ANALYSIS: PNI

By Michael Gable 

The S&P 500 Index has drifted lower in the past few sessions and it seems to be wanting to give us a retest
of the 7 April low.

A retest of a major low about three weeks later is quite normal, and that that would give investors a lower risk entry point. This is because chasing the market when the S&P 500 Index is already over 5500 and running hard can be quite risky; but buying in if we get a reversal in the lower 5000’s means that we can run a tighter stop.

Another interesting stat is when we look at the number of stocks in the S&P500 Index trading under the 50-day moving average, the number is of course quite high, but it is nearly on par with every other major low in the past 20 years.

Essentially this means that a lot of selling has been done and we are entering the zone to be looking for the next buy signal.

Today we offer a technical view on Pinnacle Investment Management Group ((PNI)),

After breaking the uptrend at the start of March, PNI then continued to fall sharply, finding a low in early April.

At this low point, it created some bullish divergence with the RSI.

This is where the RSI bottomed out in early March and started to head higher while the share price was still heading lower.

The stock bounced off the lows on strong volume and has been trading sideways for the past few days. As long as the April low can hold, Pinnacle should go on to rally higher from here.

Current levels are a buying opportunity and initial stops can be placed back near the April low.

We expect a retest of the major resistance line near $22.

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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