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Technical update: 29 December 2017

Violeta Todorova

Central Petroleum (CTP) – long term buy

The decline from the March 2017 high has lost momentum over the past two months and the price has been trading sideways within the boundaries of a symmetrical triangle. The weekly RSI indicator has completed a bottom reversal pattern suggesting that the down trend has likely bottomed at $0.077. The higher lows on the daily chart are an encouraging sign, showing that buying support is building up.

Over the long term, the potential upside price target is $0.19.

IPH (IPH) – double blessed buy

In our last update on October 22, 2017 we discussed the overbought nature of the stock and recommended clients trim positions around $5.80. Over the past two months the stock has been trading in a correction mode and the current price action re-visited its previous resistance of $5.11 where initial buying interest is likely to arise. A bullish divergence between the price and the stochastic indicator has formed over the past month, suggesting that the price is likely to bounce soon. Given the oversold and diverging momentum conditions on the daily chart we are comfortable accumulating the stock around current price levels.

The potential upside price target is $5.85.

Highlands Pacific (HIG) – double blessed buy

HIG broke above its key resistance of $0.09 in early November 2017 and has confirmed that the stock is now trading in a primary up trend. The recent short term pull back has lost momentum over the past few weeks and the price has been consolidating within the boundaries of an imperfect bullish ascending triangle. A break above resistance of $0.099 is highly likely and will trigger a rally to $0.11 in the near term. Over the medium term, levels to $0.14 are achievable.

We are comfortable buying the stock at current price levels.

Accent Group (AX1) – tactical buy

The down trend from the July 2016 has clearly lost momentum over the past seven months and the price has been trading sideways, building a large base. The current short term down swing has found support at $0.76 and with the rising RSI and stochastic indicators we see a good probability of the price rallying in the short term.

The potential upside price target is $0.91.

The Star Entertainment Group (SGR) – target reached

In our update on 14 August, 2017 we discussed the likelihood of the price rallying in the months ahead and recommended clients buy the stock at $5.05. A strong rally over the past four months and our medium term upside price target of $6.15 has now been reached.

Although at this point there is no reversal signal evident on the chart, given the proximity to key resistance of $6.32 and the overbought and diverging momentum conditions, we recommend active clients trim positions.

More information

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Disclaimer(s): Analyst may own shares in some or all of the companies mentioned.

The information contained in this report is provided to you by Morgans Financial Limited as general advice only, and is made without consideration of an individual's relevant personal circumstances. Morgans Financial Limited ABN 49 010 669 726, its related bodies corporate, directors and officers, employees, authorised representatives and agents ("Morgans") do not accept any liability for any loss or damage arising from or in connection with any action taken or not taken on the basis of information contained in this report, or for any errors or omissions contained within. It is recommended that any persons who wish to act upon this report consult with their Morgans investment adviser before doing so.