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QBE Insurance Group (QBE)

(Click here for QBE fundamental research and company information)

Technical View

QBE has been in correction mode since the beginning of the year.

After declining by 37% into July the stock bounced from long-term support and then broke above the 2010 downtrend in mid September. This was followed by a long-term Buy signal in October.

Despite these positive developments, the stock has been lacklustre, with price retreating to the July lows in November. It broke marginally below those lows on November 25th but the break was quickly reversed and the stock posted an impressive 6.8% gain last week.

Momentum is positive across all time frames and although a break above the September high at $18.40 is required to complete the base formation, it is highly likely that a low of long-term significance has been registered.

A break above the September high would open potential for a move to the $20 level.

Buy.

The stop-loss level is $16.08.

(click image to enlarge)