Medium term
Trade view / 16 July 2015 at 11:11 GMT

Correction on real estate giant Simon Property Group petering out

CEO / Att Trading
Austria
Instrument: SPG:xnys
Price target:
Market price:
Background

Simon Property Group Inc. (SPG) is one of the world's largest real estate holding companies. The corporation owns, leases, manages, acquires and expands revenue-generating shopping centres. Its portfolio consists of more than 325 objects in various countries around the world.

The company also maintains investments in various shopping centers in Europe, Japan, Korea, Malaysia and Mexico. It is also one of the largest lessors of commercial retail space in the US, which deals only with tenancy agreements  for several years in order to avoid frequent change of tenants. The stock of SPG is listed on the S&P 500 and various other indices.

SPG Weekly Chart
spg1
Source: ATT Trading

Management and risk description

The stock is currently in a strong correction on the daily chart and therefore it provides interesting targets at around $171 and $164 (figure 2,) in the desired short direction. A trader could be looking for a smaller size trend to get an entry into this trade. Figure 2 also shows a resistance zone, which additionally confirms the preferred short scenario.

SPG Daily Chart
spg2
Source: ATT Trading

This resistance zone consists of the SMA-200  (figure 2, red line) and the drawn trendline, which also supports the preferred short idea. The decreasing volume in the correction would be another indication which would additionally favour our idea.

If the stock breaks through the resistance zone our short scenario would be over. Before entering the trade it is necessary to look for news e.g. earnings.

Parameters

Entry: $179.

Stop: $183.50.

Target: $170.80, $164.

Time horizon: medium-term.

— Edited by Martin O'Rourke

Non-independent investment research disclaimer applies. Read more

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