Qantas – Algo Buy Signal

Qantas Airways is under Algo Engine buy conditions and is now a current holding in our ASX 100 model.

The switch from sell to buy conditions means the stock has automatically been added, however, traders may wish to watch the shorter-term indicators for confirmation of the change in trend.

The below graph highlights the key trend signals to watch and we forecast buying support to build near the $6.50 level.




Keep QANTAS On The Radar

Our ALGO engine triggered a sell signal on QAN on November 14th at $6.05.

Since then the stock has traded lower and reached $5.45 in early trade today.

From a longer-term perspective, we believe QAN will benefit from from the 30% drop in crude oil since October. Even if energy prices stabilize near current levels, QAN is well-placed for solid profit growth in 2019.

We expect to see investor interest accumulate in the $5.10 area and will look for an ALGO buy signal in that range.






ALGO Sell Signal For QANTAS

Our ALGO engine triggered a sell signal for QANTAS into yesterday’s ASX close at $5.90.

This “lower high”pattern is reference to the intraday high of $6.30 from September 12th.

On October 25th, we posted a report to buy QAN in the $5.40 area on the basis of lower oil costs and steady earnings growth.

At this point, it looks like oil prices are overdue for a rebound higher, which could pressure QAN back into our $5.40 to $5.35 buy zone.

As such, we suggest taking profits in QAN.  At current levels the return will be just over 8%.

We will look for another ALGO buy signal in the $5.30 area.



Buy The Dip In QANTAS

QAN released their Q1 trading update today.

With total revenue up 6.3% and forward bookings up 8% on the same period last year, we expected the share price to have risen in early trade.

However, with widespread downside pressure across the ASX today, QAN has slipped to $5.40.

This is in the middle of our recent $5.45 to $5.35 buy zone. As such, we suggest investors add to long positions with a medium-term price target in the $7.20 range.





Despite widespread downside pressure and increased volatility in the ASX 200 index, shares of QAN have stabilized above the $5.10 support level.

QAN will be releasing its September quarter trading update next Thursday and  holding their AGM next Friday.

We believe that both of these events will be supportive of higher share prices.

QAN has been in our ASX Top 100 model portfolio for over a year and we suggest investors look to add to long positions in the $5.35 to $5.45 range.

Our medium-term target is $6.70 with a longer-term view to $7.35.