Three ASX stocks to watch in July
Woodside Energy concluded June with a 7.3% gain while the ASX 200 was down by more than 12%; CBA shares tumbled to a 13-month low and BrainChip dropped 30% in June.
Australia's share market crossed the finish line after a grim June and quarter with negative numbers, marking it the worst month since March 2020. During the past six months, the ASX 200 was down by more than 12% and although there is no reset button, the beleaguered equity market does bring renewed hope.
Market participants expect the central banks to change their hawkish stance once the economy has shown convincing signs of cooling down. As for the week ahead, the RBA will again lead the decision-making to lift the interest rate for the third straight month.
Today we look at three stocks:
For the ASX 200, the energy sector is unlikely to conclude June with a gain amid fluctuating oil prices, the falling value of coal, and the spreading of the energy crisis. That beinf said, the major players in the ASX energy sector delivered mixed performances led by Woodside Energy Group with a 7.3% gain while Santos moved down by 8.6%.
Woodside Energy is now the biggest energy share on the ASX after the company completed its merger with BHP’s petroleum business in early June. The goodwill following the merger has helped Woodside to shelter from the headwinds and deliver a beat to the market.
Major support for the price can be found from the month-long ascending trend line which sees the price stabilise at around $31. Resistance should come from the 50 and 100-day moving average between $31.5 to $32. However, once broken through this level, investors can expect upside movement toward the 20-day moving average.
Commonwealth Bank of Australia
The rapid changing interest rate has placed the banks on high alert and the central stage. The Commonwealth Bank of Australia's share price fell by more than 13% in June and last week announced to lift its fixed home loan by a jaw-dropping 1.4% in one go.
What's more, the interest rate is expected to keep edging up.
On the other hand, the property market is cooling and a higher interest rate will help the bank's margin and profit. However, the accelerated slowdown in the home loan market could lead to a greater number of loan losses and a shrink in the market size.
The price of the CBA is currently trading at its lowest level in 13 months. The high from last February and March can be considered as key support for now at around $89 and the steep 20-day moving average is set to limit the high for the rebounds. While the RSI shows a pull back from the oversold territory, massive selling pressure is expected from the level of $93.
BrainChip is a developer company for AI computer chips and the recent star company had a turbulent month as its share price ended the month 30% lower amid the broad ASX200 market which was down 9%.
The steep decline of BrainChip’s share price can be attributed to the external market sentiment rather than the company’s performance and this was particularly the case in the risk-off market where BrainChip sits. However, the risk ahead can’t be ignored with the global chip producer being under the whammy recently after the semiconductor maker warned that demand is falling and sales will be lower in the current quarter. As such, global chip leaders like Nvidia and AMD are being hit particularly hard as the concern about entering the recession cycle increases.
BrainChip has seen its share price increase substantially from a value of $0.04 in 2020 to 9.49% in early 2022. As shown from the daily chart, the price is moving along the descending trend line since early June and the price has found its support at 0.783 at the moment. A bounce from this level brings the price to the trend line resistance at 0.855 which is also where the 20-day moving average sits. Moving forward, should the price manage to succeed in a breakout, buyers can anticipate a short-term rebound to the level of $1. On the flip side, the breach of current support may erase all gains for 2022.
Take your position on over 13,000 local and international shares via CFDs or share trading – and trade it all seamlessly from the one account. Learn more about share CFDs or shares trading with us, or open an account to get started today.
This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.
Start trading forex today
Find opportunity on the world’s most-traded – and most-volatile – financial market
- Trade spreads from just 0.6 points on EUR/USD
- Analyse with clear, fast charts
- Speculate wherever you are with our intuitive mobile apps
See an FX opportunity?
Try a risk-free trade in your demo account, and see whether you’re onto something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See an FX opportunity?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from just 0.6 points on popular pairs
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See an FX opportunity?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets