Technical analysis: 20 August 2020

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
20 August 2020, 11:30 AM

Corporate Travel Management (CTD) – Target reached

In our last update on the 24th of July 2020 we discussed that support of $8.40 is solid and recommended clients buy the stock.

A strong rally has unfolded over the past two weeks and our upside price target of $14.00 has now been reached.

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

The current price action is close to key resistance of $14.75 where initial selling pressure is likely to arise.

Given the proximity to key resistance and the overbought momentum readings, we recommend active clients take some profits.

Motorcycle Holdings (MTO) – High Conviction Buy

The rally from the March 2020 low has lost momentum over the past two months and the price has been trading sideways.

During the pull back the RSI indicator remained above its 40% bull market range showing that momentum is still strong.

On Wednesday the indicator completed a bottom reversal pattern, suggesting that the price is likely to break above minor resistance of $1.84 and trade higher in the coming weeks.

The first potential upside price target based on the breakout is $2.15, however levels to $2.40 appear easily achievable in the month ahead.

We have a high conviction the price will follow the bullish lead from the RSI indicator and we are comfortable to buy the stock at current price levels before an actual breakout has occurred.

Pro Medicus (PME) – Breakout is imminent

The rally from the March 2020 low has lost momentum over the past three months and the price has been trading lower, fluctuating within the boundaries of a downtrend channel.

The leading RSI indicator completed a bottom reversal pattern on Wednesday showing that momentum is improving and suggesting that the price is likely to trade higher in the coming weeks.

A break above the down trend line crossing at $26.00 is likely and would suggest that higher prices are likely to unfold.

The initial upside price target is in the range between $28.00 and $29.00.

IPH Limited (IPH) – Bullish breakout

The rebound from the March 2020 low has quickly lost momentum and over the past four months the price has been trading sideways, fluctuating between $7.01 and $8.20. Wednesday’s price action broke above resistance of $8.20 suggesting that higher prices are likely to unfold in the near term.

The first potential upside price target based on the breakout is $9.00, however over the long-term higher prices are achievable.

The momentum indicators remain constructive and support our positive view on the stock.

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: 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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