The Greek stock market has surely taken a dive and investing in such low stock prices hides great potential. My today’s stock picks in the Athens stock exchange are the MYTIL stock, ELLAKTOR, MARFB and BIOX stocks. There are a couple of reversal indicators in their stock charts, and although the risk of the downtrend’s continuation still exists, the support levels are well defined and help a lot in setting the stop loss orders. The stock charts are available using Esignal’s trading software as I subscribed to their service some days ago.
MYTIL‘s stock is trading sideways in the weekly stock chart and has been consolidating since 2008, after a huge downtrend in the early 2008, losing about 60% stock value. The usual pattern is Down-Side-Up-Side-Down and since I’m talking about the weekly chart, chances are we will see an uptrend in the following months. With that in mind and looking at the daily MYTIL stock chart, the consolidation is quite obvious. The stock price is currently at the lower Bollinger Band and my take profit target is set initially at the upper Band. However, I will be taking closer look at the hourly stock chart where I can identify a reversal quicker.
ELLAKTOR‘s stock is next and the weekly chart shows a Fail Bottom and a penetration of the moving average. The stock price failed to reach out the lower Bollinger Band and I’m predicting a price movement close to the upper band. The daily chart shows the Bollinger Bands study to have narrowed the last month, which is a sign that a reversal of the long term trend is imminent. Since there was a downtrend the last months, I am expecting a short term uptrend to say the least, that is also strengthened by the analysis on the weekly chart. My stop loss is set at the last lowest low peak at 2.75, targeting a profit at about 3.50. The risk/reward ratio is quite acceptable in my opinion.
In the case of the MARFB stock, a previous Double Bottom signals a possible reversal of the stock’s price, which was also verified by the high stock price in late July. Although the stock is currently trending downwards, I suppose it is a short term trend, rather than a continuation of the late downtrend. For that reason I have entered long and have set a stop loss at about 1.45 and a take profit target at 1.58 right at the moving average. Now, if there are some favorite signals, say the price breaks above the moving average, I will let the trade run, as I will have most probably caught a full reversal. I could have set my stop loss below 1.40 for more safety, but then I should target for a bigger movement. In my case, I don’t care if the stock price does not reverse, I’m just targeting for a retracement to the moving average with the hope of the reversal for extra rewards.
Finally, the BIOX stock’s daily chart has once again double bottoms during last month and I’m going to risk some money as the stock price has been consolidating the last 4 weeks right at the moving average in the weekly chart. I predict at least a short term uptrend up to the upper Bollinger Band but we could also witness an even higher stock price, up to 4.70 for some nice profit. The hourly stock chart also aids in setting the stop loss right below the Dragonfly Doji.
I always pick up a bit of MYTIL between 4 and 4.20 and give back most of it by 4.70 – 4.80, keeping a bit for the exaggeration. ELLAKTOR is also a nice play.
What is your take on the more general trend for the greek market?
Well, it will either bounce back or take a dive! Yesterday the banks performed well after the European loans for the Eastern Europe's investments but we will find out if that was enough to boost the Greek stock market's comeback. Although the so-called crisis has led the market to lose a lot of its value, there are stocks like EUROC (EUROCONSULTANTS S.A.) that performed exceptionally. There are always opportunities for long positions even at the most difficult times.
I agree with you. The systemic problem here seems to be the banks and their capitalisation. Another company which I am picking up at 0.53 euro is EYPIK (Evropaiki Pisti). Even though the shallow nature of this particular stock exchange allows the major shareholders of the companies to do what they like with the price of their stock, I am holding this one. As well as a few others which, agreeing with you, are opportunities for long positions even in these times.