Trading idea for Computershare

by Michael Gable

Computershare is shaping up as a good little trade here - especially for those who are keen on trading this market bounce but wish to steer clear of resources. After rallying strongly during March, the stock has spent a good two months correcting back in 3 waves to retest the March breakout. We have now seen a piercing pattern on the chart as well as a reversal in the RSI. The combination of these two reversal signals tells me that this is a good probability trade. Stocks on our market often find resistance at the 50% retracement level, which happens to coincide with CPU's previous consolidation around $8.35. So if I was purchasing stock around these levels, I would wait for a rally towards $8.35 before writing a covered call to generate some additional income.


Disclaimer: Michael Gable is an Authorised Representative (No. 376892) and Fairmont Equities 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.

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