Australian Sharemarket

The Australian sharemarket has been able to rally over the past fortnight with the All Ordinaries Index rising 0.8% last week and within touching distance of it’s resistance level. The chart below demonstrates the sideways movement of the index over the past three months with prices supported at 5,350 points with overhead resistance in the region of 5,540 points. On Thursday prices attempted to breakout above the resistance level but were pushed lower towards the close with the formation of a long tailed reversal candle.

The overall picture indicates that bulls are trying to push the markets higher but have been met with selling pressure at current levels. In order for the All Ords to push higher prices will need to breakout and close above the resistance level of 5,550 points. Any further declines from current levels are likely to be halted by the support price of 5,350.

DAILY CHART ALL ORDS INDEX

Lonestar Resources (LNR)

Lonestar Resources, Ltd. is a leading independent oil and gas company involved in exploration, production, and acquisition of unconventional oil and gas reserves. 

The share price has been in a strong up-trend for most of 2014. Friday saw a bullish candlestick rising through resistance on strong volume. There could be further up-side left in this share but volatility is high and traders do need to be careful after such a strong run up that prices could be extended. In situations such as this I make sure I have a tight stop loss in the event that prices turn downwards quickly. I will wait for the opening of the markets on Monday to see if prices can open above the previous high of $0.51. If this occurs then a limit buy order in this area can be covered with a stop loss under Friday’s low of $0.48.

Happy Trading

Flavio

DAILY CHART LONESTAR RESOURCES (LNR)