Kingfisher shares: The odds of a sustainable rally

by Alistair Strang from Trends and Targets |

After one successful call on this stock, our chartist explains his new forecast for the B&Q owner.

Kingfisher PLC (LSE:KGF) 

When the US President, Mr Trump, recently moaned about the poor quality of modern toilet flushes, there was a definite "hold on a minute" in-house as we'd made an identical comment, one alas ignored by the world's media.

It was June last year and an article about Kingfisher (LSE:KGF) (aka B&Q), along with the reasons their share price was going to flush itself down to 184p.

We were correct about modern toilets and their illusory water savings and oh, yes, we were also correct about 184p as a rebound level.

Importantly, our 184p drop ambition was not breached, this giving the hope the current (somewhat moderate) rebound shall prove to have some integrity.

The immediate situation suggests above 230p should now aim for an initial 240p with secondary, if bettered, calculating at a longer term 267p.

Visually, it appears any rise risks foundering at the 267p as there's little doubt a glass ceiling awaits at such a level.
 
That's about the end of any positive spin on this story as we're nervous at the slavish attention being paid to the downtrend since 2018.

It has created the situation, where weakness now below the trend (208p presently) signals the prospect of reversal to an initial 197p with secondary, when broken, down at 175p.

The secondary level scares us more than a modern WC as it takes the price into a region with 141p as "bottom".

Source: Trends and Targets      Past performance is not a guide to future performance

Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation, and is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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