Technical Analysis: 17 December 2020

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
17 December 2020, 9:00 AM

Bapcor (BAP) – Double Blessed Buy

BAP has been trading in a secondary up trend since March 2020 which is still technically intact.

The recent pull back has retraced close to its previous support of 46.63, which is likely to hold and where initial buying interest is likely to arise.

The RSI indicator has completed a bottom reversal pattern from oversold territory suggesting that higher prices are likely to unfold in the short-term.

The MACD indicator has turned up from oversold levels also pointing to higher price levels in the week(s) ahead.

Given the improvement in the momentum conditions, we are of the view that a break above minor resistance of $7.35 is likely, which could trigger a rally to $8.00.

Over the medium-term, levels to $8.50 are achievable. The current price presents a good opportunity to buy the stock.

Aristocrat Leisure (ALL) – Double Blessed Buy

ALL has been trading in a strong secondary up trend since March 2020 which is still technically intact.

The current pull back has retraced close to its previous support of $28.48 where buying interest is likely to arise.

The RSI and the stochastic indicators have reached oversold territory suggesting that the price is likely to bounce soon.

The initial upside price target is $33.50. Over the medium-term, levels to $38.00 appear achievable.

Given the proximity to previous support and to oversold momentum levels, we are comfortable to buy the stock at current price levels.

Transurban Group (TCL) - Accumulate

In our last update on the 13th of November 2020 we discussed the overbought nature of the stock and the likelihood of the price declining in the short-term.

The price retraced close to its key support of $13.08 which appears solid and is likely to hold.

The RSI and the MACD indicators have bounced from oversold territory, suggesting that higher prices are likely to unfold in the short-term.The potential upside price target is $15.30.

The weekly momentum indicators remain in neutral territory at this juncture in time, therefore we are of the view that the price will continue to trade sideways, fluctuating between $13.08 and $15.63 in the months ahead.

EML Payments (EML) – Improvement in momentum

The rebound from the March 2020 low has lost momentum over the past six months and the price has been trading sideways, fluctuating between $2.66 and $4.26.

The weekly RSI indicator broke above its resistance earlier in the week, showing important improvement in momentum.

Based on the breakout of the leading RSI indicator, we anticipate the price would follow suit.

A decisive break above $4.26 would suggest that another leg up is likely to unfold in the month(s) ahead.

The potential upside price target based on the expected breakout is $5.00. Any short-term share price weakness would provide an opportunity to buy the stock.

MoneyMe (MME) – Bullish breakout

MME has been trading sideways over the past year, fluctuating in a wide range between $0.50 and $2.00.

The pull back from the August 2020 high has lost momentum over the past six weeks and the price has been in the process of building a small base.

Wednesday’s price action broke above minor resistance of $1.53 suggesting that the correction is likely to be complete and that higher prices are likely to unfold in the near-term.

The first potential upside price target is $1.80, followed by $2.00 in the coming month(s). The current price levels present a good opportunity to buy the stock.

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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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