Technical Analysis: 5 April 2019
About the author:
- Author name:
- By Violeta Todorova
- Job title:
- Senior Technical Analyst
- Date posted:
- 05 April 2019, 7:55 AM
Adairs (ADH) – approaching support
The decline from the September 2018 high has lost momentum over the past four months and the price has been trading sideways, fluctuating between $1.52 and $2.19. The current short term down swing is approaching support of $1.52 where initial buying interest is likely to arise. The RSI indicators are in oversold territory suggesting that the price is likely to bounce soon. We would be looking to accumulate the stock in the low $1.50's.
The initial upside price target is $1.80. Over the medium term, levels to $2.00 are achievable.
Fortescue Metals Group (FMG) – overbought
FMG has been trading in a strong up trend since September 2018 with the price posting a 10-year high of $7.89 on April 3, 2019. Bearish divergences between the price, the RSI and the MACD indicators have formed on the daily chart suggesting that the price is vulnerable to a pull back from here. The weekly momentum conditions are strongly overbought, also pointing to likely weakness in the short term.
The current strength in the share price provides a good opportunity to lighten positions.
South32 (S32) – approaching resistance
S32 has been trading in an upward trajectory since December 2018 which is still technically intact. The current price action is approaching a band of resistance between $4.07 and $4.28 where selling pressure is likely to arise.
Any further short term strength from here would provide a good opportunity to lighten positions.
WH Soul Pattison (SOL) – approaching support
The up trend from the October 2017 low has lost momentum over the past five months and the price has been trading sideways, fluctuating between $24.03 and $31.87. The current short term down swing is approaching its key support of $24.03 where initial buying interest is likely to arise. The RSI and the MACD indicators are entering oversold territory suggesting that the price is likely to bounce soon.
We see a good opportunity to accumulate the stock in the range between $24.00 - $25.00. The potential upside price target is $27.00.
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