Technical Analysis: 10 May 2019

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
10 May 2019, 9:24 AM

Collins Foods (CKF) – overbought

CKF has been trading in a strong up trend since July 2018 which is still technically intact. Tuesday's price action reached an all-time high of $8.35 pushing the weekly and daily momentum indicators into overbought territory.

While at this point there is no sign that the secondary up trend is over, given the overbought momentum conditions, we see the price as vulnerable to a pull back in the short term.

FlexiGroup (FXL) – target reached 

In our last update on March 22, 2019 we discussed the likelihood of the price trading higher in the months ahead and recommended clients buy the stock at $1.35. A strong bounce has unfolded this week and yesterday's price action posted a high of $1.97 exceeding our price target of $1.80.

While at this point there is no sign that the medium term up trend is over, the stock has almost doubled in value in three months and the weekly RSI is approaching overbought territory, which suggests that the near term upside from here is likely to be limited and the price is due to take breather.

IRESS (IRE) – overbought

IRE has been trading in a strong up trend since January 2019 which is still technically intact. The weekly and daily RSI indicator has reached overbought territory suggesting that the price is vulnerable to a pull back in the short term and could take a breather in the months ahead. We continue to like the stock over the long term, and we see such potential share price weakness as a buying opportunity.

We will provide an update in due course.

Orica (ORI) – close to resistance 

ORI has been trading in a secondary up trend since October 2018 which is still technically intact. Thursday's price action rebounded close to a band of resistance between $20.36 and $21.39 where initial selling pressure is likely to arise. The weekly and daily RSI indicator readings are close to overbought territory suggesting that the near term upside from here is likely to be limited.

Active clients may consider lightening positions.

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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