CBA Chart Review.

By Kenneth Robson on January 20, 2016 • ( 0 )

Disclaimer:

I am not qualified to give appropriate financial advice, and do not attempt to do so. I am qualified as a technical analyst and this post seeks to share information of a technical nature with other retail investors. This post looks at the current fortunes of the Commonwealth Bank of Australia as illustrated by a daily candlestick chart over the past twelve months.

Background

CBA has been chosen as one stock in my portfolio as that has been unaffected by the 8% decline in the Australian share market since the start of the year. It is one that retail investors, scratching their heads to know where to put their savings in an environment dominated by bears, could consider.

CBA Dy Jan16

Observations

The share-price is rebounding from a low of $70.15 on September 29, 2015.
Change of primary trend became apparent on October 22, 2015 when the share price exceeded the previous high at $76.
The uptrend is steady and remains intact to the present.
The share-price is rebounding off a trough with a double bottom between $77 and $78.

Discussion

With economists painting a gloomy picture for 2016 even the banks may not be immune to falls. It is incumbent on all investors to carefully monitor the stocks in their portfolio.

In particular a failure of the present impulsive move higher to exceed resistance of the previous high at $81, and a fall of the share-price below support at the previous trough of $77, should alert investors that transition into a downturn could be occurring.