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Technical update: 3 November 2017

Violeta Todorova

Inghams (ING) – accumulate

ING has enjoyed a great run over the past seven months and after almost reaching our medium term upside target of $3.94 in October 2017, a pull back to unwind the overbought and diverging momentum conditions took place. The current down swing has retraced close to its previous resistance of $3.49 where initial support is likely to arise. The RSI and the MACD indicators have reached oversold territory, suggesting that the price is likely to bounce in the near term.

The initial upside price target is $3.80. Over the medium term, levels toward $3.90 are achievable.

Macquarie Atlas Road (MQA) – approaching resistance

MQA has enjoyed a strong run over the past month with the price advancing 14.5% from its October 2017 low. The current up swing is approaching its key resistance of $6.23 where initial selling pressure may arise. The RSI and the MACD indicators are in overbought territory, suggesting that the near term upside from here is likely to be limited.

While at this point there is no reversal signal on the chart, active traders may consider trimming positions into strength.

Blue Sky Alternative Investments (BLA) – overbought

BLA has been trading in a strong up trend since February 2017 which is still technically intact. Thursday's price action reached a record high of $14.99 and strongly overbought momentum levels on a weekly and daily basis. Thursday's bar is a closing price reversal and shows that the sellers are stepping in.

Given the strongly overbought momentum conditions and the short term reversal bar on the daily chart we are of the view that the stock is vulnerable to a pull back in the near term.

AusNet Services (AST) – at key resistance

AST has been trading in an upward trajectory since August 2017 with the current price approaching its key resistance of $1.80. The RSI and the MACD indicators are approaching overbought territory, suggesting that the near term upside from here is likely to be limited.

Given the proximity to key resistance and the overbought momentum readings we see the stock as being vulnerable to a pull back in the short term.

CSL Ltd (CSL) – target reached

In our last update on August 17, 2017 we discussed the likelihood of the price rising in the near term and recommended clients buy the stock at $125.27. A strong rally has unfolded over the past two months and our price target of $140.00 has now been reached. We noted that the price has lost momentum over the past few weeks and we are of the view that the price is likely to take a breather in the weeks ahead. Given the proximity to key resistance of $145.00 and the loss of momentum, we see the near term upside from here as limited. Active clients may consider trimming positions.

Over the long term, we continue to like the stock but at current price levels we rate CSL a hold.

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.