Santos Poised For Upside

This story features SANTOS LIMITED. For more info SHARE ANALYSIS: STO

By Michael Gable 

Last week we noted that the chart for the Dow Jones was telling us that the market was going to rally and that the last time we had a similar signal was back in February. As a result, last week saw our market post its best weekly gain since, you guessed it, February this year. We still maintain that the ASX200 will head up towards 5700 before encountering resistance. Companies have generally been reporting good results and if this trend continues, and if this trend of reporting continues, then it makes sense to see our market continue to head higher for now. We have identified an opportunity in Santos ((STO)).
 

We were positive on Santos at the beginning of April and although it rallied well, it has since stalled and traded in a range between about $14.00 and $14.50. Closer inspection shows that this looks like a continuation pattern as Santos uses up a bit more time before making another move higher. It formed a higher low 2 weeks ago so we could be close to seeing STO break to the upside. If you see a break on the upside, then expect an initial rally up to $15, and then ultimately a retest of last year’s high at $15.80.

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)

Michael assists investors to achieve their goals by providing advice ranging from short term trading to longer term portfolio management, deals in all ASX listed securities and specialises in covered call writing to help long term investors protect their share portfolios and generate additional income.

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

Michael Gable is an Authorised Representative (No. 376892) and Fairmont Equities Pty Ltd is a Corporate Authorised Representative (No. 444397) of Novus Capital Limited (AFS Licence No. 238168). 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.

Find out why FNArena subscribers like the service so much: "Your Feedback (Thank You)" – Warning this story contains unashamedly positive feedback on the service provided.

Click to view our Glossary of Financial Terms