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Technical Analysis: 11 March 2019

Violeta Todorova

Sydney Airport (SYD) – approaching resistance

SYD has been trading in an upward trajectory over the past month which is still technically intact. The current short term upswing is approaching a band of resistance between $7.62 and $7.79 where initial selling pressure is likely to arise. The RSI and the MACD indicators have approached overbought territory suggesting that the stock is likely to pull back soon.

Given the proximity to key resistance and the overbought momentum conditions, we are of the view that the near term upside from here is likely to be limited.

Nanosonics (NAN) – overbought

NAN has staged an impressive rally since December 2018 which is still technically intact. The current upswing has lost momentum over the past two weeks and the price has been trading in a narrow range, fluctuating between $4.06 and $4.43. The RSI and the MACD indicators have reached strongly overbought levels suggesting that the price is vulnerable to a short term pull back.

A break below minor support of $4.06 is likely and could trigger a decline to $3.85.

Cleanaway Waste Management (CWY) – overbought 

CWY has been trading in a strong secondary up trend since December 2018 which is still technically intact. A small bearish divergence between the price and the RSI indicator has formed on the daily chart showing that momentum is deteriorating. The weekly RSI and stochastic indicators have reached overbought territory suggesting that the price is vulnerable to a short term pull back.

The initial downside price target is $2.05. 

Magellan Financial Group (MFG) – overbought

MFG has enjoyed an impressive rally since December 2018 which is still technically intact. A small bearish divergence between the price and the RSI indicator has formed on the daily chart showing that momentum is deteriorating. The RSI and the MACD indicators have reached overbought levels suggesting that the price is vulnerable to a short term pull back.

The initial downside price target is $33.50.

Fortescue Metals Group (FMG) – at resistance 

The up trend from the September 2018 low has clearly lost momentum over the past two weeks and the price has been trading sideways, fluctuating between $5.94 and $6.83. The latest short term upswing has encountered selling pressure around its previous high of $6.83 which is likely to exert resistance in the short term. The stochastic indicator has reached overbought territory suggesting that the price is likely to pull back in the short term. Given the proximity to previous resistance and the overbought momentum readings, we are of the view that the short term upside from here is likely to be limited.

Active traders may consider trimming positions.

More information

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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.