BHP Share Price: Medium-Term Outlook Looks Promising

The BHP share price is down 2.73% as risk aversion takes hold of global markets. The risk aversion comes from fears of global growth and the recent escalatory actions taken by Russian President Vladimir Putin. This flight to safety has sent commodity prices and the stocks of commodity companies lower.

InvestingCube's S&R Levels

FTSE100

FTSE100 (6870.8)

Not in Sell Zone

STOP

SELL

TP1

6840

TP2

6750

Despite the drop in the BHP share price, the company’s stock still appears to be carrying some tailwinds which have capped the losses sustained on the day. BHP had made an earlier offer to take over ASX-listed miner Oz Minerals for $8.4 billion.

OZ Minerals has received a green light to develop a $1.7 billion nickel and copper project in a remote WA location. There are speculations that this could prompt an improved takeover offer from BHP, but this has not been confirmed. 

The Zachs investment report published on the Nasdaq website projects a bounce back in the stock, following the expectation of commodities recovering in the medium to long term on pent-up demand from the housing and automotive markets.

The midpoint of the guidance range for its iron ore production for the 2023 fiscal year is expected to show a year-on-year increase of 1%. The BHP share price is also expected to benefit from the company’s adoption of smart technologies across its value chain. 

BHP Share Price Forecast

The stock is presently testing support at the 2198.5 price mark. A breakdown of this level allows the bears to push toward the 2144.0 support level (25 July and 1 September 2022 lows). If the bulls fail to defend this support, the 2061.5 and 1995.5 (15 July low) price pivots enter the picture as potential targets to the south. 

On the flip side, a bounce on the current support that takes out the 2264.5 resistance barrier (1 August and 5 September highs) allows the bulls to gain access to the 2330.5 resistance. 2401.5 (25 May low) enters the mix if the bulls achieve clearance of the 2330.5 resistance. 

BHP: Daily Chart