Technicals | Oct 06 2020
By Michael Gable
We continue to see opportunity in stocks linked to the reopening of the Australian economy. Apart from travel stocks, we can also see an opportunity in cyclical names which should recover well from here. Today we look at Zip Co ((Z1P)).
Finally, the other potential big trade that has caught our attention is energy. We are optimistic that oil and gas stocks will be trading higher in 12 months. Unfortunately, they have had a pretty rough few months. However, price action in the last couple of days is telling us that the selling may have finally exhausted itself and we could see a nice turnaround here in the energy names. We probably need another day or two to confirm that, but as always, we tend to spot these things earlier than most people and it is definitely a sector to keep an eye on right now.
Like most BNPL stocks, Z1P ran a bit too hard at the end of August and has seen its share price fall back to where it was 2 months ago. We have been watching this support level near $6 and are now satisfied that it should hold and Z1P should therefore rally higher from here. The stock is at the start of the move so current levels are a buying opportunity.
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
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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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