JHX is a global building materials company and the largest global manufacturer of fibre cement. Their operations span both Australia and the US.
“It’s a business we have liked for a long time because of its ability to sustainably grow earnings,” Michael said.
What’s your current view?
“The company should benefit from increased construction spending and their recent market update has shown that they are on track to increase market share.
“The share price chart is a great example of a stock in a sustainable uptrend.
“Each time it has a bit of a run, it then takes a nice breather before heading higher again.
What does the chart below for JHX show?
“We can see from this daily chart, that since May 2020, it has been hugging the 100-day Exponential Moving Average.
“Most recently, it has come back to that 100-day EMA and is now bouncing off that.
What does this mean?
“This tells me that JHX shares will continue to trend higher from here.
“Each time it bounces off the moving average, we can use that as a buying opportunity. Conversely, a major break of this moving average can be interpreted as a warning sign,” Michael concluded.
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