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Rio Tinto: bottom up

This story features RIO TINTO LIMITED. For more information STOCK ANALYSIS: RIO

By Michael Gable

We continue to maintain our positive bias in the market here. Last week we were talking about the US Dollar Index looking in bad shape, and a drop in the US Dollar Index would be a tailwind for commodities, including gold. We are seeing continued support for commodities stocks here, especially over the past couple of days, so this is a sector to be overweight.

Today we have a chart on Rio Tinto ((RIO)).

After the peak in March, RIO trended lower and daily volatility was quite high. Over the past few weeks, however, we have seen volatility fade as RIO began to form a small base.

Yesterday it managed to break above that range and so it looks like a bottom in place and the current levels are a buying opportunity. A close above $100 will be further confirmation that RIO is ready to recover from here.

The content included in this article is not by association the views of FNArena (see our disclaimer).

Michael Gable is Managing Director of Fairmont Equities (www.fairmontequities.com)

Fairmont Equities is an equity advisory firm that assists private clients in the professional management of their equity portfolio. We are based in the Sydney CBD but provide services to private clients across Australia. We believe that the concepts of fundamental analysis and technical analysis of stocks are not mutually exclusive. Whether you are a trader or a long-term investor, combining the two methods is essential for success. As a result, Fairmont Equities’ unique analysis is regularly featured in media such as Sky News Business, CNBC, The Australian Financial Review and the ASX newsletter. Contact us for a free trial of our research and information about our portfolio management services.

Michael is RG146 accredited and holds the following formal qualifications:

• Bachelor of Engineering, Hons. (University of Sydney)
• Bachelor of Commerce (University of Sydney)
• Mortgage Loan Diploma (Finsia)
• Diploma in financial services [Financial Planning] (Finished)
• Completion of ASX Accredited Derivatives Adviser Levels 1 and 2

Disclaimer

Fairmont Equities Australia (ACN 615 592 802) holds an Australian Financial Services License (No. 494022). The information contained in this report is general information only and is copied to Fairmont Equities. Fairmont Actions reserves all intellectual property rights. This report should not be construed as providing personal financial or investment advice. All examples shown are for illustrative purposes only. Past performance is not a reliable indicator of future performance. No person, person or organization should invest money or take any action based on the material contained in this report, but rather should independently satisfy itself (whether by expert advice or otherwise) of the suitability of such action. Fairmont Equities, its directors and/or officers assume no responsibility for the accuracy, completeness or timeliness of the information contained in the report.

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