Technical Analysis: 20 September 2019

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
20 September 2019, 2:26 PM

Woodside Petroleum (WPL) – Accumulate around $31.00

WPL has been trading sideways over the past year, fluctuating between $29.33 and $39.38.

The decline from the June 2019 high has lost momentum over the past month and the price has been in the process of building a small base.

The current short term up swing appears headed to $31.00 where we will be looking to accumulate the stock.

The initial upside price target is $34.00.

Over the long term, our view on the stock is neutral and we favour further sideways trading.

Comet Ridge (COI) – Ready to take off

COI has been trading in a down trend since June 2018 which now appears to be reversing direction.

The weekly RSI indicator has formed a bottom reversal pattern from oversold levels (a very power signal) which suggests that higher prices are likely to unfold in the months ahead.

A bullish divergence between the price and the RSI indicator has formed on the daily chart, pointing to a strong rebound in the near term.

Thursday’s price action broke on an intra-day basis above resistance of $0.275 showing that a bottom reversal pattern is likely to be in the making.

A decisive break above this level is likely to occur and could be followed by an impulsive move to $0.31.

Carnarvon Petroleum (CVN) – Bullish breakout 

CVN has been trading sideways over the past year, fluctuating between $0.305 and $0.695.

The recent short term down swing has lost momentum over the past month with the price trading sideways between $0.35 and $0.405, building a small base.

Thursday’s price action broke above minor resistance of $0.405 suggesting that higher prices are likely to unfold in the near term.

The initial upside price target is $0.46.

Otto Energy (OEL) – Buy around $0.047

OEL has been trading sideways over the past two years, fluctuating between $0.035 and $0.082.

The decline from the March 2019 high has lost momentum over the past two months and the price has been trading sideways, fluctuating between $0.044 and $0.056.

A subsequent break above resistance of $0.056 is likely which could trigger a rally to $0.063.

Any short term share price weakness to $0.047 would provide a great buying opportunity.

Senex Energy (SXY) – Target reached 

In our last update on June 19, 2019 we discussed the likelihood of higher prices unfolding in the near term and recommended clients buy the stock at $0.31.

A strong rally has unfolded over the past month and our price target of $0.36 has now been reached and exceeded.

The RSI and the MACD indicators have reached overbought territory suggesting that the price could pull back in the short term.

Over the longer term, our view on the stock remains positive and we see levels to $0.48 as achievable.

Fortescue Metals Group (FMG) – Approaching resistance 

FMG has been trading in an up trend since September 2018 which is still technically intact.

The up trend has lost momentum over the past two months and the price has been trading sideways, fluctuating between $6.59 and $9.55.

The current short term up swing is approaching its resistance of $9.55 where initial selling pressure is likely to arise.

The RSI and the MACD indicators have approached overbought territory suggesting that the price is likely to pull back soon.

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

Treasury Wine Estates (TWE) – Approaching resistance

In our update on May 12, 2019 we discussed the likelihood of the price bouncing in the near term and recommended clients buy the stock at $14.50.

A slow but consistent rally has unfolded over the past months with the current price action approaching its key resistance of $20.20 where initial selling pressure is likely to arise.

The weekly and daily momentum indicators are approaching overbought territory suggesting that the rally is likely to pause soon.

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

Origin Energy (ORG) – Target reached

In our last update on August 16, 2019 we discussed the likelihood of the price bouncing in the near term and recommended clients buy the stock around $6.80.

Higher prices have unfolded over the past month and our initial upside price target of 47.70 has now been reached.

The current short term up swing has rebounded to its previous resistance $8.05 where initial selling pressure may arise.

The RSI indicator has approached overbought territory suggesting that a mild pull back could unfold soon.

Adelaide Brighton (ABC) – Building a base

ABC has been trading in a down trend since July 2018 which is still technically intact.

The monthly RSI indicator reached oversold territory suggesting that there is very good probability support at $2.85 will hold.

A large triple bullish divergence between the price and the RSI indicator has formed on the weekly chart suggesting that the price is likely to bounce in the months ahead.

A higher low appears to be forming on the daily chart showing that the buyers are stepping in.

The first potential upside price target is $3.35 followed by $3.85 in the coming months.

Paladin Energy (PDN) – Short term bounce

PDN has been trading sideways over the past two years fluctuating between $0.105 and $0.22.

The decline from the November 2018 high has retraced to its key support where strong buying interest is likely to arise.

The RSI indicator has reached oversold territory suggesting that the price is likely to bounce in the short term.

The first upside price target is $0.135 followed by $0.16 in the coming months.

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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