Forecasting is like betting with a ‘risk/fear rush’ that has an addictive feeling. Nigerians believe that they know everything about everything esp. football betting….security forecasting on the local financial markets is no different.
Access has got analysts difficultly guessing its next direction with a N75bln capital increase coming in the 1-Q-2019 => a potential ”price dilution” event as we expect the capital increase ”strike” price to be N6.21 @ 3 new shares for every 4 old shares because based on evaluation of the Diamond/Access merger, Access management values herself @ N7.45….will the market value it with a premium or discount by capital increase day ???
- We suspect that in the short-term, Access price is developing an expanded flat e.w.p thus should bottom within the range between N6.24 – N6.80 just before the expected ”Santa Claus” rally.
- We remain bullish on Access as far as the min. support level @ N6.24 is not broken.
- Then, we can expect an impulsive bullish trend towards a target resistance range between N8.84 – N11.20
- Caution !!!!…..Thus Access remains in a short/intermediate term bear rally and should resume it’s long-term bear trend within 1-H-2019….enjoy the ride !!!
Fundamentally, Access has a sell signal but technically, there may be a buy signal….
- The New “Access/Diamond” management has cancelled the N75bln capital increase thus delaying any potential ”price dilution” event. Based on the capital increase expectation in the last month, Access had fallen deeply to the recent support level @ N5.20
- Though there was a short-term rebound in wk-4-Jan-2019 above N6.50…..we suspect that in the short-term, Access price may continue to fall even below the last support @ N5.20 based on this week’s sudden sharp fall in the trader’s navigator indicator.
The New “Access/Diamond” Bank is a done deal dd. 20/3/2019 with diamond bank shares suspended and Access Bank giving a FY-2018 dividend of 25k. Take note all diamond bank former shareholders qualify for the Access Bank dividend.
Since 12/3/2019, we have an early buy signal from our main trend indicator – The Traders’ Navigator though we await MACDH to go positive. Fundamental analysts have a forward 2019 target price of N14.17…..our next short-term resistance target price is towards N7.50
Access Bank Plc’s price is showing a clear bullish trend though still within a slightly bullish trend channel. Our initial resistance target was met @ N7.55 but not broken.
Path #1: In the coming trading days, we can expect a bearish correction towards a support target range between N5.93 – N6.28….thus for this forecast to hold critical support level @ N5.49 must not be broken.
Path #2: If the critical support level @ N5.49 is broken in the coming trading days, we can expect a deeper bearish correction towards a lower support target level of N4.56