Technical update: 1 September 2017

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
01 September 2017, 8:50 AM

NEXTDC (NXT) – double blessed buy

NXT is trading in a primary bull trend which is still firmly intact. The weekly chart remains constructive and our long term view on the stock is positive. The up trend has lost momentum over the past three months and the price has been trading in a correction mode, fluctuating within the boundaries of a large flag pattern. Thursday's price action decisively broke above the pattern confirming that the correction is over.

The first potential upside price target is $5.00, however higher prices are achievable over the long term.

Aveo Group (AOG) – double blessed buy

AOG has been trading in a down trend over the past year which appears to be losing momentum. A Class A bullish divergence between the price and the RSI indicator has formed on the daily chart, suggesting that the price might be at a turning point. The weekly momentum indicators have turned positive from strongly oversold levels, pointing to a likely recovery in the months ahead. The daily stochastic indicator generated a buy signal on Thursday and we are confident that the price is likely to trade higher in the near term.

The first potential upside price target is $2.88. Over the medium term, levels towards $3.10 are achievable.

Healthscope (HSO) – short term bounce

HSO has been trading in a downward trajectory over the past year and at this point there are no signs that the trend is reversing. The RSI and the MACD indicators have reached strongly oversold territory, suggesting that the price is likely to bounce soon. The last three bars on the daily chart are forming higher lows, showing that buying interest is likely to emerge in the short term. We see a good probability of the price bouncing to $1.95 in the weeks ahead.

Over the medium term, the price is likely to trade sideways, fluctuating between $1.70 and $2.10.

Steadfast Group (SDF) – buy

SDF is trading in a primary up trend which is still firmly intact. The recent pull back retraced to its previous support of $2.54 where strong buying interest was encountered. The RSI and the stochastic indicators have turned positive, suggesting that higher prices are likely to unfold in the short term.

The first potential upside price target is $2.90. A subsequent break above key resistance of $2.93 is likely and will trigger a rally to $3.10 over the medium term.

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.

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