Zigup Plc : Technical rebound on the GBp 400
Entry price | Target | Stop-loss | Potential |
---|
GBX 414.6 |
GBX 0 |
GBX 394.9 |
-100% |
---|
Northgate shows relatively strong fundamentals and is coming back to attractive prices.
From a fundamental viewpoint, the security is cheap with a P/E Ratio of 8.94x for 2016 and 8.71x for 2017.
Besides, EV/Sales is low with a ratio at 1.47x for this year.
Technically, in daily data, even if moving averages are still in a downtrend, a positive reaction in the GBp 400 area should stop this trend and allow a technical rebound towards GBp 454. Moreover, technical indicators show a significant oversold condition which strengthens this bullish scenario.
Therefore, the proximity of the GBp 400 support is an opportunity to open a long trade on Northgate. The first goal is a return in the GBp 454.2 resistance area, that is a potential of around 9%. In fact, the security has to cross this area in order to re-establish a bullish trend in the mid term. A stop loss order can be placed under the support currently tested.
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