After a correction of the oslo stock exchange benchmark index (osebx) of roughly 13%, breaching below the 45 day moving average of 275 (closing at 270.49) we now change our bearish opinion to a neutral one.
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Focus is on stockpicking rather than sector allocation, finding companies that shows good cashflows. Earnings season is ahead, and we expect there to be profit warnings (PWs) ahead of these, so thread careful.
We started taking profit a tad early, but can't really say that reducing risk and reallocating into defensive was a move I'm disappointing with. The PCCs have gotten some purchase pressure and gone up along with health care.
Technically, however, we're now getting bearish and expect a correction of the market to be imminent.
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We observe a fibonacci retractment level around 315 that we see as the upper bound of the turning point. We crossed the 255 day moving average today and expect the correction to start in this area (301-315). Target for correction is adjusted upwards since may 10th due to market conditions with new target range 255-270 where we see a nice meeting point of fibonacci levels, 45 daily moving average as well as 200 daily moving average.
