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\nBottom Line 15\/04\/15<\/strong><\/p>\n Daily Trend: Up<\/span> Technical Analysis<\/strong><\/p>\n Commonwealth Bank ((CBA)) is Australia’s leading provider of integrated financial services including retail banking, premium banking, business banking, institutional banking, funds management, superannuation, insurance, investment and sharebroking products and services. The Group is one of the largest listed companies on the Australian Securities Exchange. It provides a full range of retail banking services including home loans, credit cards, personal loans, transaction accounts, and demand and term deposits through its Commonwealth Bank and Bankwest brands. The Group has leading domestic market shares in home loans, personal loans, retail deposits and discount stockbroking, and is one of Australia’s largest credit card issuers. In June 2014 both James Hardie and Stockland announced that Commonwealth Bank of Australia and its related bodies corporate ceased to be a substantial shareholder.\u00a0 Broker\/Analyst consensus is a comprehensive “Sell”.\u00a0 The dividend yield is currently 4.3%.<\/p>\n Reasons to be bullish: Price is pretty much where we left it during our last review which comes as no great surprise considering that the broader market has also been taking a breather.\u00a0 However, our expectations haven’t changed over the past few months with our much vaunted $100.00 target consistently moving closer.\u00a0 That said, over the short term there is room for slightly lower levels to be tagged with the downside target being $91.69 which is basis the wave equality projection.\u00a0 This is assuming a 3-leg movement down is unfolding from the recent pivot high made in late March which seems likely.\u00a0<\/p>\n Looking at the bigger picture patterns via the weekly time frame (not shown) also offers higher prices.\u00a0 Many brokers continue to be highly sceptical in regard to banks in general as well as CBA though this has been their view for a long time.\u00a0 Most continue to advocate a “Sell” recommendation.\u00a0 We tend to focus more on the charts so let’s get back to the aforementioned weekly chart.\u00a0 Although the trend has been strong over the years, from May 2013 price pretty much went nowhere until the latest rally kicked into gear in October 2014.\u00a0 In other words price consolidated during that time which can only be viewed in a positive light.\u00a0 With this in mind we expect that the recent leg higher over the past five months or so still has plenty of legs in it yet before terminating.\u00a0 In fact it would take a break beneath $73.57 to suggest a major top is in position; not our highest expectation, at least not until $100.00 is tagged.<\/p>\n Trading Strategy<\/strong><\/p>\n With the trend from October of last year being exceptionally strong we have to go with the flow and expect that the current retracement is going to be shallow.\u00a0 This isn’t always the case of course although it’s very apparent that any dips continue to be sought after by investors.\u00a0 At this stage we need to stand aside although if our wanted a-b-c correction terminates at our annotated target we’ll be looking for an entry.\u00a0 The prerequisite, as always is that demand returns at those slightly lower levels. Re-published with permission of the publisher. www.thechartist.com.au All copyright remains with the publisher. The above views expressed are not by association FNArena’s (see our disclaimer).<\/em><\/p>\n Risk Disclosure Statement <\/strong><\/em><\/p>\n THE RISK OF LOSS IN TRADING SECURITIES AND LEVERAGED INSTRUMENTS I.E. DERIVATIVES, SUCH AS FUTURES, OPTIONS AND CONTRACTS FOR DIFFERENCE CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CAREFULLY CONSIDER YOUR OBJECTIVES, FINANCIAL SITUATION, NEEDS AND ANY OTHER RELEVANT PERSONAL CIRCUMSTANCES TO DETERMINE WHETHER SUCH TRADING IS SUITABLE FOR YOU. THE HIGH DEGREE OF LEVERAGE THAT IS OFTEN OBTAINABLE IN FUTURES, OPTIONS AND CONTRACTS FOR DIFFERENCE TRADING CAN WORK AGAINST YOU AS WELL AS FOR YOU. THE USE OF LEVERAGE CAN LEAD TO LARGE LOSSES AS WELL AS GAINS. THIS BRIEF STATEMENT CANNOT DISCLOSE ALL OF THE RISKS AND OTHER SIGNIFICANT ASPECTS OF SECURITIES AND DERIVATIVES MARKETS. THEREFORE, YOU SHOULD CONSULT YOUR FINANCIAL ADVISOR OR ACCOUNTANT TO DETERMINE WHETHER TRADING IN SECURITES AND DERIVATIVES PRODUCTS IS APPROPRIATE FOR YOU IN LIGHT OF YOUR FINANCIAL CIRCUMSTANCES.<\/em><\/p>\n Technical limitations If you are reading this story through a third party distribution channel and you cannot see charts included, we apologise, but technical limitations are to blame.<\/strong><\/em><\/p>\n
\nWeekly Trend: Up<\/span>
\nMonthly Trend: Up<\/span>
\nSupport levels: $91.69 \/ $89.60 \/ $82.89
\nResistance levels: $96.69 \/ $100.00<\/p>\n
\n? Well leveraged to a low interest environment.
\n? It is well placed to absorb potential arduous capital requirements.
\n? A recent study of Banks in Australia bodes well for CBA.
\n? High Yielding stocks should continue to be supported with interest rates likely remaining low.
\n? CBA is the best performing bank in one of the best performing sectors.
\n? First time home buyers are on the increase with CBA well positioned to take advantage.<\/p>\n
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