Fortescue: Recovery Underway?

This story features FORTESCUE LIMITED. For more info SHARE ANALYSIS: FMG

By Michael Gable 

The S&P500 Index is breaking to new highs but our local market continues to be range bound. Although on occasions it has appeared poised to get moving again, we can't be too confident until it smashes past the February peak. There are still some opportunities under the surface though. The larger mining stocks seem to be making a move here, the strongest being Fortescue Metals Group ((FMG)), so we have included a chart of that into today's research.

The decline in FMG appears to be over for now. FMG fell under $20 a week ago and volumes picked up as there were likely a number of retail stop-losses at that level. However, the share price managed to find strong support near $19 and the trading range tightened up for a few days. Last Friday it then launched higher, closing near its highs and repeating that feat again yesterday. We also have a buy signal on the daily MACD (circled). All of this is telling us that we are likely to get a recovery here in the share price and current levels are therefore 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

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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