Technical Analysis: 4 January 2019

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
04 January 2019, 10:05 AM

Northern Star (NST) – target reached

In our last update on September 21, 2018 we discussed the likelihood of the price declining in the short term and recommended clients buy the stock around $8.00. The expected pull back unfolded throughout October and December 2018 with the price dropping below our suggested buy level for a week and thus providing a great opportunity to set long positions. A strong rally has unfolded over the past month and our upside price target of $9.50 has now been reached.

The weekly and daily RSI readings have reached overbought territory suggesting that the price is likely to pull back soon. Although at this juncture there is no sign that the medium term up trend is over, given the overbought momentum conditions we recommend active clients trim positions.

Perseus Mining (PRU) – target reached

In our last update on October 4, 2018 we discussed the likelihood that the correction from the July 2018 high was over and the bullish implications from the break above resistance of $0.37. The price took longer to build its base but constantly posting higher lows suggested that buying pressure was building up. A strong rally has unfolded since early December 2018 and our initial upside price target of $0.44 has now been reached.

Although at this point there is no sign that the rally is over, we note that the RSI indicator is approaching overbought levels, suggesting that the price is vulnerable to a short term pull back.

Livehire (LVH) – closing our tactical buy

In our last update on November 9, 2018 we discussed the likelihood of the price trading higher in the near term and opened a tactical buy at $0.375. A strong rally unfolded over the past two months and our upside price target of $0.50 has been reached and exceeded. The momentum indicators have reached overbought territory suggesting that the price could fall in the short term.

Over the medium term, our view on the stock is neutral and we favour further consolidation between $0.30 and $0.60.

Smart Group (SIQ) – target reached

In our last update on October 29, 2018 we discussed the bearish implications from the break below key support of $10.87 and highlighted that lower prices are likely to unfold over the medium term. A strong decline unfolded over the past two months and our downside price target of $9.00 has now been reached.

While the stock is oversold on a weekly and daily basis and a short term rebound could unfold soon, at this point we don't see a sign that the down trend is over.

More information

Morgans clients can login to view all recent technical analysis on companies we cover by browsing the research section and filtering by 'technical analysis' in the Market Updates section. If you are interested in finding out more, please contact your nearest Morgans office.

Disclaimer: 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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