Investment thesis based on:
1. Positive trading for the March quarter saw revenues up 13.2%
2. Matt Bekier joins EGP as CEO/MD provides the company with stability to implement aturnaround strategy
3. Lock out laws in NSW adds to non-gaming revenue growth at The Star casino
4. Lower capital expenditure means higher cash generation as refurbishment projects start rolling off
Echo had taken a tumble in the last two years but we can see that since about November last year, it has been base building.
During that time we have seen the Relative Strength Index (RSI) climb from an oversold condition.
While the price was building a base, the momentum as measured by the RSI, was heading higher.
It has culminated in a breakout in the EGP share price last week.
This current level around $2.80 appears to be a bit of an obstacle.
So if EGP can clear that, then the next levels of resistance are around $3 and then major resistance at $3.40