Technical Analysis: 17 January 2019
About the author:
- Author name:
- By Violeta Todorova
- Job title:
- Senior Technical Analyst
- Date posted:
- 17 January 2019, 4:27 PM
Wesfarmers (WES) – building a base
The decline from the August 2018 high has lost momentum over the past month and the price has been trading sideways, fluctuating between $30.40 and $33.06. The higher lows on the daily chart are an encouraging sign and show that buying support is building up. While the momentum conditions remain weak at this point suggesting that the price may continue to trade sideways in the short term, over the medium term, the stock is likely to extend gains to $34.00.
We would be looking to accumulate around $31.00 - $31.50.
AGL Energy (AGL) – overbought
AGL has been trading in a down trend over the past two years which remains technically intact. The current short term up swing is approaching a band of resistance between $22.28 and $23.30 where initial selling pressure is likely to arise. The RSI and the MACD indicators have reached overbought territory suggesting that the stock is vulnerable to a short term pull back.
Given the proximity to a band of resistance and the overbought momentum conditions, we are of the view that the near term upside from here is likely to be limited.
Paradigm Biopharmaceutical (PAR) – building a small base
The decline from the December 2018 high of $2.15 has lost momentum over the past two weeks and the price has been trading sideways, building a small base between $0.92 and $1.09. The MACD indicator has reached oversold territory suggesting that the price is likely to bounce soon.
The initial upside price target is $1.10 however this level could be exceeded.
Sonic Healthcare (SHL) – building a base
The down trend from the August 2018 high of $27.00 has lost momentum over the past two months and the price has been trading sideways, fluctuating between $21.26 and $23.52. While the momentum indicators are still weak at this point, we note that a bullish divergence between the price and the RSI indicator has formed on the daily chart, which suggests that support of $21.26 is solid and the price is likely to rebound.
The initial upside price target is $23.50, however the price may overshoot.
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