Technical Analysis: 12 September 2019

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
12 September 2019, 2:24 PM

Newcrest Mining (NCM) – Deterioration in momentum

In our last update on August 9, 2019 we discussed the overbought nature of the stock and the likelihood of the short term upside to be limited.

The rally lost momentum over the past month and a double top pattern has formed on the daily chart.

The daily momentum conditions deteriorated and weekly momentum indicators remain overbought.

This suggests that further weakness could be seen in the near term.

A break below support of $34.05 would confirm the double top pattern and is likely to trigger a deeper pull back to $31.00.

Sydney Airport (SYD) – Deterioration in momentum

SYD has been trading in a strong up trend since January 2019 which is still technically intact.

A lower high has formed on the daily chart showing that the sellers are increasingly taking profits around $8.60.

The medium term up trend line drawn from the February 2019 low has been broken on Tuesday showing that the up trend is deteriorating.

The weekly MACD indicator is in overbought territory suggesting that the rally is likely to take a breather in the near term.

We see a good probability f the price trading between $7.60 and $8.40 in the coming month(s).

Australian Securities Exchange (ASX) – Bearish breakout

In our last update on August 16, 2019 we discussed the overbought nature of the stock and the likelihood of the price breaking below support of $82.73.

On Wednesday the price broke below support on a closing basis suggesting that a deeper pull back is likely to unfold in the weeks ahead.

The initial downside price target based on the breakout is $76.00.

Mirvac Group (MGR) – Bearish breakout

MGR has been trading in a strong up trend since January 2019 which now appears to be reversing direction.

A large bearish divergence between the price and the RSI indicator has formed throughout May and August 2019 warning that momentum is deteriorating.

Earlier in the week the RSI broke below its bull market range support at 40% suggesting that a secondary correction is likely to take place.

Last week’s price action broke below support of $3.09 suggesting that a top is now in place.

The initial downside price target based on the breakout is $2.80, however this level could be exceeded.

Unibail-Rodamco-Westfield (URW) – Improvement in momentum

URW has been trading in a down trend since listing which is still technically intact.

The stock significantly underperformed its peers and we now see the first tentative signs of improvement in momentum.

On Wednesday the RSI indicator broke above its resistance suggesting that the price is likely to rebound to its long term down trend line crossing at $10.80.

A break above the down trend line would be the first bullish sign with long term implications and is likely to trigger a rally to $11.30.

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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