From IG a couple days ago.
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ASX stocks to watch if the economy enters a recession: Woolworths, ANZ and BrainChip
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ASX stocks to watch if the economy enters a recession: Woolworths, ANZ and BrainChip
As the recession concern spreads across the financial market, which sectors and stocks have the potential to demonstrate their resilience? Today we are looking at three ASX stocks
Hebe Chen | Market Analyst , Melbourne |
Tuesday 21 June 2022 11:16
Concern over the recession is rapidly spreading across the global financial market and the market is responding in a determinedly pessimistic way. The S&P 500 and Nasdaq are trapped in a bear market with the Dow Jones following and the
ASX 200 had the worst fortnight as the index tumbled down 11% in June.
The stock market has historically managed to show strong resilience in difficult times as stocks outperformed the S&P 500 but the question this time is, which sectors and stocks have the potential to demonstrate this strength again?
Today, we look at three ASX sectors.
Technology sector: BrainChip
BrainChip had been on a rollercoaster this year. Its share price experienced some freefalling moments with a more than a 15% decline in contrast to great times when the price jumped up more than 5% in consecutive days. However, despite tumbling from its peak early this year, the BrainChip share price is still up 60% over the last 12 months.
The Australian artificial intelligence (AI) technology company has gained a lot of attention since the company was accepted into the Arm AI Partner Program last month. The global leading AI program will enable BrainChip to access Akida, the worldโs first commercial neuromorphic AI accelerator, to foster the development of world-class AI products and applications. Although the company is yet to generate much revenue, that doesnโt stop the investor from associating the company with massive potential in the future.
According to the daily chart, the price just managed to break out from the descending trend line since the end of May and an attempt to touch the 20 days-moving average has failed on the first try but is set to the critical watch point for the next couple of days.
If the price has overcome the imminent resistance around $1.0, the level of 1.05 will be the next destination. On the flip side, the previous trendline should be able to stop or at least pause the decline at $0.83.