Time To Buy BHP?

This story features BHP GROUP LIMITED. For more info SHARE ANALYSIS: BHP

By Michael Gable 

The Australian market continues its show of strength, led more by the banks than resources. When looking at BHP ((BHP)), for example, we expected it to weaken off several weeks ago. Whilst it has definitely underperformed the market during that time, it has not exactly pulled back very much. So, we revisit the chart to provide an update on when to buy it.

In our last update on the BHP chart at the end of May, we wrote that we expected weakness in the stock. We were looking at support at $32 and then further weakness eventually back towards $30. The shares have found support at $32 but seem to be hanging in here. It now looks like we might get a correction in the form of a triangle, rather than a correction downwards as previously thought. This means that if BHP makes a break to the upside of the triangle (indicated by the diagonal lines), then that would imply a resumption of the uptrend and therefore trigger another buying opportunity. If that were to occur, then our next upside target would be near $40. For the moment we wait and see what it wants to do.

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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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