Breakout Opportunity In Mineral Resources

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This story features MINERAL RESOURCES LIMITED.
For more info SHARE ANALYSIS: MIN
The company is included in ASX100, ASX200, ASX300 and ALL-ORDS

Mineral Resources is offering an opportunity, Fairmont Equities' Michael Gable reports, with recent consolidation indicating a potential breakout higher.

By Michael Gable

There seems to be a pattern developing, whereby any bad news regarding the Iranian war is delivered on a weekend, our market gets hit on Monday, and then news of a “deal” filters through before US markets open and stocks are saved again.

It seems as though our market got the memo because it held up pretty well yesterday, and “voila”, apparently somebody somewhere in Iran wants to do a deal.

Interestingly, the price of oil lost most of its intraday gain overnight, but it appears as though the disconnect between oil futures has physical barrels diverged quite a bit recently which implies the “price” of oil that we see being reported is about -20% to -30% less than what it really is.

If the disruptions have taken away about -10% of supply, then demand needs to adjust.

Even covid-style lock-downs can’t eliminate 10% of demand.

It tells us one thing: oil prices have to go much much higher to reduce demand down to the level of supply.

We therefore still form the view that any dips in energy stocks are a buying opportunity. 

Today, we offer a technical view on Mineral Resources ((MIN)).

We were positive on Mineral resources on a few occasions in the second half of last year and once again, it is providing us with a buying opportunity.

After peaking in late-January near $65, it then fell back towards $50.

Since then, however, it has traded sideways to further consolidate against the uptrend from 2025.

We now have a clear resistance line with multiple touch points. Mineral Resources has been trading well in the past few weeks, which we believe indicates it is on the cusp of breaking out of this consolidation and rallying higher again.

Mineral Resources is a buy here for those looking to get in early, initial stops can be considered back near $50.

More conservative investors can wait for a daily close above $60 to use as a buy signal.

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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