The Berkeley Group’s share price was heavily penalized and is now in an oversold situation near to a solid support area.

According to Surperformance rating, the company presents a strong financial situation as its treasury should be positive at GBP 98.7 million for this year. PER is relatively moderate in comparison with its peers (13x for 2013). Finally, we can note that analysts pooled by Thomson Reuters have recently revised upward their EPS and revenue estimates.

The Berkeley Group is oversold because it is near to the GBp 2193 support area. This situation gives credit to a potential technical rebound. Thus, the stock could find new energy and would rise towards the next GBp 2325 resistance.

So as to make the most of a potential technical rebound, it seems opportune to take a long position above GBp 2193. A confirmation of this pattern would enable the security to reach the GBp 2325 resistance, with a potential gain of 6%. Investors should not insist under GBp 2193 and are better off placing a stop loss order under this threshold.