Buy at current levels or better for the medium term plus. After basing sideways for the past two and a half years, Basil Read looks ready to start its recovery. It’s formed a large inverse head and shoulders (as labelled) and recently broke out above line 2 (the “neckline”). That’s pointing to a higher target. Note: There’s resistance at line 1 (1420c) but expect that line to be broken. Buy at current levels and if it pulls back towards line 3 (1230c), buy again (ie, add). Its price at the time of writing was 1330c. The inverse head and shoulders is pointing to a minimum target of 1725c – ie, the height of that pattern projected up. Once it breaks out above line 1 resistance (1420c) there will be little to stop it running. Place your initial stop-loss as a weekly close below line 3 – ie, below 1220c. Basil Read is a mid-cap but its chart indicates (by implication) that downside on large cap construction stocks is limited. They may retest – but unlikely to break – their 2011 lows.