Turnaround stories require some time to get the market’s attention. Here are a few observations based on pure market action that may give an early opportunity into a longer-term play. From a trading perspective, these can give high risk/reward outcomes as the stop loss* levels are very close to entry points, yet the upside can be very positive.
For this analysis, use the weekly time frame, as this goes someway in eliminating the dead cat bounce effect that follows large declining move often seen in shorter time frames.
*A stop loss would be taken on the break of the current support levels indicated.
Telecommunications, the better of the two negative sectors down 12%, is only made up of four stocks. Spark Infrastructure (SPK) was the only positive result with a 5.8% gain. Vocus (VOC) was the largest draw in the sector at -47%, TPG Telecom (TPM) next with – 31% and Telstra (TLS) at - 9% for the year.