As an update to last week’s post on GrainCorp, we again remind readers that GNC is approaching an oversold level.
We expect support will likely develop at or near the current price level.
The trade in GNC is likely to be a corrective move from oversold conditions.
The stock price is unlikely to develop into a meaningful uptrend. We recommend a stop loss below the final pivot, or entry point. GNC
$8.50 – $9.00 is buying support with $9.50 is the profit target.
On 12th July, our Algo Engine triggered a buy signal in Sonic Healthcare, at or near $22.20.
We see this as a level of price support and our base case is that Sonic trades sideways, at or near the current price.
Sonic reports earnings on the 16th of August and we expect underlying EPS growth of 8%, which will support a forward dividend yield of 3.8%.
When combining a covered call option, we’re generating 10 – 12% cash-flow per year.
Our Algo Engine triggered a buy signal in SEK back in mid-June, when the stock was trading at $16.15, since then the price action has rallied to $17.50.
We consider the current price level as full value and investors should consider either taking profit, or selling covered call options.
Seek reports their earnings on the 16th of August and the market is expecting underlying EPS growth of 10 – 15%, delivering NPAT of $192 million.
Our Algo Engine triggered a sell signal in BOQ at or near $12.15.
The price action is making a “lower high” formation and the short-term momentum indicator is rolling over.
As IAG share price retraces from the recent $7.00 high, investors should expect our Algo Engine to generate a buy signal.
Buying support is likely to develop in the $6.25 to $6.50 range.
The S&P ASX 200 index finished the week down 0.7%. The best performer was the Property Trust sector, up 0.9% and the worst performer was the Telecoms sector, down 4.1%.
The XJO continues to trade below the 5836 “lower high” formation, as indicated on the chart below.
Our Algo Engine has triggered a buy signal in the iShares Russell 2000 ETF.
Other recent Algo Engine buy signals on ETF’s include the iShares Global Consumer Staples ETF.
Other recent Algo Engine buy signals on ETF’s include the Vaneck Vestors World Ex Aust Quality ETF.
We continue to like the buy-side opportunity in AMC and IPL, following the recent Algo Engine buy signals.
MPL, SHL & CSL are worth adding to your watch-list. We see the current price levels in these names, at or near new buying support.
Our Algo Engine has triggered multiple buy signals in Resmed, since the stock price began a series of “higher low” formations going back to 2015.
The recent strong rally started in late 2016 after making a low at around $7.00.
With the stock now trading at $10.00, the PE is pushing into the high 20’s.
The upcoming earnings result on the 2nd August will have to deliver 10 – 15% underlying EPS growth to meet market expectations.
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