Zak Mir Charts the Fastest Growing AIM Stocks

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A few weeks back I charted some of the contemporary greats in terms of fund management performance, Giles Hargreave, Mark Slater and Neil Woodford. Now I am varying the remit in looking at where the brightest fundamental prospects on the AIM market are, as shown in the table below.

The best of both worlds, using technical and fundamental analysis, is a mantra for many in the market these days, whether they essentially follow either one or the other. This is because even if you are fully in one camp or the other, it is pleasant to know that the tea leaves are positively aligned in the discipline you do not primarily use.

For instance, I am always happy to give the benefit of the doubt to a charting position if the dividend has just been hiked, or in the aftermath of a swing to profitability. What can be seen in the case of the five examples below is that knowing EPS growth is forecast be up sharply over the next few years does allow a degree of flexibility as far as the charting position is concerned.

Michelmersh Brick Holdings (MBH)

The problem on the daily chart of Michelmersh Brick Holdings is that the stock has come off what was a bumper rally from below 20p to 75p plus. The question now is how far the shares might yet fall before any positive effective from the EPS jump to come finally kicks in.

The favoured scenario over the next 2- 4 weeks is that support will come in at or above the former November 2013 intraday floor at 47.5p. The alternative approach is to wait on a break back above the 20 day moving average at 60p, even though with the RSI currently at an ultra oversold 17 we would expect a bounce to occur imminently.

Greenko (GKO)

As was the case with many stocks last months, for Greenko there was a bear trap reversal from below the previous 2014 support at 137p. This offers us the opportunity to take advantage of a positive technical setup, one which would remain in force while there is no end of day close back below the old May floor.

In terms of what the potential upside may be here, it is likely that any sustained clearance of the 50 day moving average could lead over the following 1-2 months back to the main post summer 2014 resistance at 180p plus.

Havelock Europa (HVE)

It has to be admitted that if were not for the prospective EPS growth at Havelock Europa one would probably not be rushing into this situation with any great gusto. But at least it can be seen how despite considerable resistance for the shares in the 20p – 25p band over the post 2013 period, there is the chance for new support to come in around present levels, towards an uptrend line from the beginning of 2012.

The view is that the positive fundamental earnings backdrop should be enough to allow the buying to kick in from above one year support above 15p. The alternative is to be a momentum buyer on any weekly close back above the 50 day moving average at 21p.

Mytrah Energy (MYT)

Things look to be that much more straightforward in terms of the bullish technical prospects at Mytrah Energy where we can describe a reasonably conventional range trade opportunity, following a higher low for November towards 70p versus January this year.

The chances are now that while we remain above the November floor at 69p on a weekly close basis Mytrah Energy shares will have the momentum to return to the main post July resistance at 90p plus over the next 1-2 months.

Gemfields (GEM)

With Gemfields we are looking at what appears to be a decent momentum situation from a charting perspective, an idea which is backed up by the way that there has been an ascent within a rising trend channel from the start of the year currently based at 46p. Adding to this is the November rebound for the stock above the 200 day moving average now at 44.8p, with such a configuration normally suggesting significant bullishness given that there has been no need for a test of this key feature.

The suggestion now is that while there is no end of week close back below the 200 day line the upside here is seen as being towards the 2014 resistance line now pointing at 60p, over the next 4-6 weeks.

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