Technical Analysis 19 June 2019

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Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
19 June 2019, 10:22 AM

Emeco Holdings (EHL) – lifting our target

In our last update on May 19, 2019 we discussed the oversold nature of the stock and the likelihood of the price bouncing in the short term, and we recommended clients buy the stock at $1.83. A strong bounce has unfolded over the past week and our upside price target of $2.05 has now been reached. On Tuesday the RSI broke above its bear market resistance suggesting that higher prices are likely to unfold in the month(s) ahead.

Therefore, we lift our price target to $2.50.

Senex Energy (SXY) – double blessed buy

SXY has been trading in a downward trajectory since October 2018 which is still technically intact. The latest downswing has retraced to its previous support of $0.26 where buying interest in likely to arise. The RSI indicator completed a bottom reversal pattern suggesting that higher prices are likely to unfold in the near term.

The initial upside price target is $0.36. Over the long term, higher price levels are achievable.

South32 (S32) – approaching support

In our last update on April 5, 2019 we discussed that selling pressure is likely to emerge around the band of resistance and recommended clients lighten positions. A strong decline has unfolded over the past two months and the current price action is approaching its key support of $3.00 where buying interest is likely to arise. The RSI and the MACD indicators are approaching oversold territory suggesting that the price is likely to bounce soon. A bullish divergence between the price and RSI has formed on the daily chart indicating that the current decline is likely to reverse course soon. Given the proximity to key support and the oversold and diverging momentum conditions, we are of the view that the near term downside from here is likely to be limited and the price should rebound soon.

The initial price target is $3.50, however over the medium term levels to $3.70 are achievable.

AGL Energy (AGL) – target reached 

In our last update on May 30, 2019 we discussed the additional bearish developments forming on the chart that were strengthening our view that the price peaked at $23.30. A strong decline has unfolded over the past month and our price target of $19.60 has now been reached. Although the daily RSI and MACD indicators have reached oversold territory, which may trigger a bounce in the short term, the stock is not technically cheap enough on a long term basis to warrant a buy recommendation.

Any share price weakness to $18.00 would spark our interest in the stock.

Qube Holdings (QUB) – at record highs

QUB has been trading in an up trend since April 2018 which is still technically intact. The current impulsive upswing broke above key resistance of $2.98 and has reached an all-time high of $3.06 yesterday (18th June). The RSI indicator has strengthened and is in the bull market range. Given the impulsive breakout and the improvement in the momentum conditions, we are of the view that the price is likely to trade higher in the month(s) ahead.

The potential upside price target based on the breakout is $3.20.

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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