“Shares in CSL have essentially gone nowhere since COVID,” Michael said.
“Most recently, ResMed (RMD) has been the topic of conversation among healthcare stocks, due to the recent declines on the back of concerns that new weight loss drugs could negatively impact their business.
“I’ve recently written why I think RMD shares can bounce from here.
“But CSL is also displaying signs that it should bounce here.
“Since COVID, CSL has been in a wide trading range between about $240 and $320.
“The past few months have seen CSL’s share price fall not only to the bottom of the recent trading range, but slightly below it.
“However, we now have a buy signal on the weekly RSI (which is unusual as CSL is rarely this oversold), and a bullish reversal signal on the weekly chart (circled).
“CSL is now back into the old range, and all this is a bullish sign.
“Current levels are therefore a buying opportunity, and we expect a solid recovery from here where it should head back to the top of the range again.
“Not only that, but often these sorts of moves finally result in the stock breaking out from the topside of the trading range as well,” Michael said.
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