Technical analysis: 17 August 2020

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
17 August 2020, 8:50 AM

AGL Energy (AGL) – At key support

AGL has been trading in a primary down trend since April 2017 which is still technically intact. The current short-term down swing has retraced to its March 2020 low of $15.15 where initial support may arise. The daily RSI indicator has reached oversold territory suggesting that the price is likely to bounce soon. The potential upside price target is $16.50.

The weekly momentum indicators remain in the bear market range, suggesting that a subsequent break below support of $5.15 is possible, which could trigger an extension of the decline to $14.50.

Overall, while the stock is oversold on a short-term basis and the price could mildly bounce from here, the weekly momentum indicators remain weak and at this point we don’t see a reversal of the primary down trend.

Telstra Corporation (TLS) – Bearish breakout

The recovery from the March 2020 low has lost momentum over the past month and the price has been trading sideways, fluctuating within the boundaries of an imperfect descending triangle.

Last week’s price action broke below minor support of $3.32 and has confirmed the bearish pattern. The initial downside price target based on the breakout of $3.05 has been reached in two days, showing the eagerness of the sellers.

The weekly RSI and stochastic indicators remain in a bearish mode suggesting that the price can drop further from here. We see potential further weakness to $2.90 unfolding in the coming weeks. In the short-term, the price can bounce mildly with strong resistance arising around $3.30.

Acrow Formwork (ACF) – Momentum still constructive

ACF has been trading within the boundaries of a down trend channel over the past two years which is still technically intact. The current price action is trading at key static and dynamic resistance between $0.30 and $0.32 (highlighted in a red circle in the chart below) which is the levels to watch in the short-term.

A break above $0.32 will have bullish implications over the medium-term and is likely to trigger higher prices in the coming months.

The first potential upside price target is $0.36 however this level could be exceeded. The RSI indicator remains above 40% and shows that momentum is still bullish. As long as minor support of $0.28 holds, our view on the stock remains positive and favor higher prices in the coming weeks.

Computershare (CPU) – Heading higher

CPU has been trading in a secondary up trend since March 2020 which is still technically intact. The up trend took a breather over the past two months and the price has been trading sideways, fluctuating within the boundaries of a bullish ascending triangle.

A break above minor resistance of $14.15 would confirm the pattern and is likely to trigger higher prices in the near term. The potential upside price target based on the expected breakout is $15.50 however this level could be exceeded.

Bank of Queensland (BOQ) – Short term weakness

BOQ has been trading in a primary down trend since March 2015 which is still technically intact. The rebound from the May 2020 low has lost momentum over the past two months and the price has been trading within the boundaries of a down trend channel.

The current short-term up swing has rebounded to its down trend line crossing at $6.30 where initial selling pressure is likely to arise. The first potential downside price target is $5.50 however this level could be exceeded.

More information

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Disclaimer: Analyst may own shares. 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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