South32 Heading North?

This story features SOUTH32 LIMITED. For more info SHARE ANALYSIS: S32

By Michael Gable 

Share markets continue to be range-bound, having made no progress for four months now. However, a bit more positive sentiment was injected into markets at the end of last week on the belief that progress was being made on the US/China trade deal. The reality however is that there will not be a date in the future where we can say "before this date we had a trade war, after this date there is no more trade war". Negotiations and agreements will occur in bits and pieces, over months, or years. It is a process. Waiting for an "event" to act as a green light where everything is safe again just doesn't exist. No-one is going to one day wave you through to the promised land of easy gains and low risk. There will always be something to worry about. When the market is like this though, we need to be nimble with some positions, and more patient with others. 

In today's report, we have a charting update for South32 ((S32)).
 

S32 fell back towards support near $2.40 and then bounced higher in August before retesting that level again last month. It now appears to be making a double bottom as well as bullish divergence on the weekly RSI. Yesterday's pullback intraday is a slight concern but if S32 can hold on here then we could see a rally back up towards resistance near $3.00. Stops can be placed fairly close by, just under the recent low. So, if S32 starts to move here, then traders will have an attractive risk/reward ratio. 

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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