Follow us on our Journey

Well I know it isn't really a weekly blog but I couldn't think what else to call it. 

While the economic landscape continues to degrade – new variants of Covid and new infections rampant around the world, inflation, stagflation, rising interest rates, supply disruptions etc. There isn’t a lot to make one think the stock market is a place to be right now.

My last blog said that I saw some green shoots in the chart patterns of some stocks. The recent run of better trading days has seen some of those shoots go on to blossom and there are now a few buy patterns being seen.

I haven’t posted detailed analysis on all of the stocks listed below, but here’s a few little gems I saw yesterday.

ALU – Looks set to close for a second consecutive week above a downtrend (a buy signal)

AX1 - Broke a 12 month downtrend last week (possibly 2 weeks depending on where you put the downtrend) and if it closes higher this week it is one to watch.

CKF – ditto as for AX1

CSL – For the past three years it has posted good gains only to fall lower on 2 occasions and the long term trend has been down. This week it has made a resistance break with a target of $305 if it doesn’t repeat the previous scenario of a rise followed by an even stronger fall.

DMP – ditto (and interestingly is in the fast-food market like CKF)

IEL – Another downtrend break but less exciting as there is also a head and shoulder pattern there suggesting potential large falls – and it previously made a similar break which suffered a flame out after a few weeks.

IMU – Broken a downtrend but quite volatile and needs to break and close above $0.25 to make a resistance break with a target of $0.31

MPL – Broken up out of sideways pattern with a target of $3.55. However, the pattern is in a downtrend which theory says should lead to a break lower – not higher. Accordingly there are some question marks over MPL.

RWC – Broken a downtrend and has a history of being a stellar performer having made over a 300% increase in value from March 2020 to November 2021. Has since fallen 61% (Fibonacci again).

TNE – Closed above a downtrend for 2 consecutive weeks but needs to break above $11.25.

TLX – Broken a downtrend and made a resistance level break with a target of $5.85. Perhaps the strongest pattern in this group – although my luck with pharmas has been poor.

The two stocks I had on my last Stocks to Watch were AD8 and PNV. AD8 has since risen by 10% but fell back a little this week to be up about 5%. PNV is a bit more of a success story being up 23% since I listed it.

I’ve added TLX and DMP to my Stocks to Watch today as both are coming off significant lows and as such have a potential to recover value.

If (and it is a very big if) the ASX has bottomed then it is possible the XAO could now move up towards 8,000 - perhaps 8,500. At least it is something to hope for.

Contact

Robert Norman

Phone: 0428 346 951
Email: robert@sharecharting.com.au

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