Is it July already? Good grief where did this month go.
So it’s first of the month, so it’s time for short term players to have a look at what’s happening in the market. And, you are no doubt aware; everything pretty much fell this past month.
Oh my god, doom and gloom, the market is crashing again.
Er, no it’s not. Relax. It’s just the usual fall prior to the end of the financial year (30 June). It happens nearly every year. Then it’s usually quiet for a while until ‘reporting season’ when companies start to release their earnings around September and for the next few months after that we should see some good gains.
So, first let’s take a look back at my predictions so far.
Told you to buy Telstra (TLS) back on 2nd May when it was trading for $2.89. It then rose to $3.04 last month and right now it’s sitting at $2.92. So what does this mean? Looking at its chart it seems that around 21 June Telstra fell sharply done to just above 2.95 and then fell a little bit further last week. I think this is a temporary fall and it wouldn’t surprise me if it rose again in a few weeks time.
Sooo, I’d wait until it hits above $3 again and then sell. It’ll probably reach that in about 4 or 5 weeks time so hang in there.
I also recommended Telecom NZ (TEL) to buy at 1.86 last month. It’s now at 1.925 and still looking good. That’s a decent 3% return in one month but I think this one still has a way to go. Hold it for now, it could reach around 6 or 7% pretty soon.
And now to July.
This month saw most sectors and stocks fall, and the only sector that managed to stay positive (although just barely) was the Utilities sector with a rise of (start the party) 0.3%.
Not great, but the best this month.
Out of the companies with this sector only two really stood out to look at further: Envestra (ENV) and Spark Infrastructure (SKI).
Envestra has increased 8.9% in one month and 5.5% in 2 months, whereas Spark has increase 3.2% in one month and 10.2% in two.
(By the way, I’ve include the excel spreadsheet with these figures as a download if it makes things easier – you can download it here. Let me know if you prefer getting a spreadsheet or would rather the pretty pictures in the post instead by saying in the comments below).
From the figures it would seem that ENV is the pick, but having a look at their charts reveals another story.
It’s quite clear that ENV is in a sideways band but SKI is still rising.
Therefore my pick for July is SKI.
I would buy at its current price of 1.30.
Set your profit sell price at 10%, so sell over $1.43.
Also don’t forget to set your stop loss as well. I’d set the stop loss on SKI at $1.20 since it hasn’t hit that since late May.
So that’s it. My predictions for July.
Till next month;
T xx
