Telstra Ready to Run
Monday, 6 July 2020
By Murray Dawes
Editor’s note: Due to an oversight, your ‘Week Ahead’ update did not appear in The Insider issue sent earlier today. We apologise for any inconvenience. You can view the video and update below.
I recently covered Telstra Corporation Ltd [ASX:TLS] in a ‘Week Ahead’ update pointing out that I thought it was a buying opportunity.
You can find the update here.
On that day, Telstra closed at $3.08 and I said ‘the very long-term charts are pointing to it as a potential opportunity just as dividends are being cut by other large companies. If Telstra can show that it is able to sustain its dividend during tough times there may be some money coming its way.’
Today Telstra is trading at $3.41, over 10% above the price when I made the video two months ago.
I think the move has only just begun because last week was the first weekly buy pivot since the crash. There is little resistance until prices enter the sell zone of the current wave, which sits at $3.68–3.85.
If you’re not sure what that means, all you have to do is watch the short presentation above, which outlines everything for you.
The set up in Telstra from the long-term semi-annual charts down to the short-term daily and weekly charts, is a perfect example of the types of trades I scour the market for every day.
If you want to understand how to find compelling trading opportunities, watch the analysis from two months ago and then watch today’s update now that Telstra is starting to run. The section on Telstra starts at 11 minutes and 16 seconds on the ‘Week Ahead’ update from 4 May. You can jump to the Telstra analysis in today’s update by accessing the table of contents in the bottom right corner of the video (the three horizontal lines).
The S&P 500 has turned back up from the 200-day moving average and is holding above the 10-day moving average after a daily buy pivot was confirmed early last week. So until prices turn back down and confirm a daily sell pivot and head below the 10-day moving average, the short-term trend is up.
There should be plenty of stiff resistance the closer it gets to the all-time high from February, but for now you have to respect the daily uptrend and either join the trend or stand aside.
Editor, Pivot Trader