Technical Analysis: 23 January 2020

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
23 January 2020, 3:12 PM

Woolworths (WOW) - Overbought

WOW has been trading in a primary up trend since July 2016 which is still technically intact.

The monthly, weekly and daily momentum indicators have reached overbought territory suggesting that the stock is vulnerable to at least a pull back in the short term.

The initial downside price target is $39.00. While at this juncture in time, we don’t see reversal signs of the primary up trend, given the monthly overbought momentum readings, we are of the view that the up trend is likely to take a breather and the upside from here is minimal.

Wesfarmers (WES) - Overbought

WES has been trading in a strong up trend since December 2018 which is still technically intact.

The monthly, weekly and daily momentum readings have reached overbought territory suggesting that the upside from here is likely to be limited and that the stock is vulnerable to a pull back in the short term.

Although, at this point there is no reversal signal on the chart, we see the current share price strength as an opportunity for active traders to lighten positions.

Coles Group (COL) - Overbought

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

The current short term up swing posted an all-time high of $16.69, slightly surpassing its November 2019 peak.

Thursday’s price action formed a bearish engulfing candle close to its previous resistance, suggesting that there is high probability of the price declining in the short term.

The RSI and the MACD indicators have reached overbought territory suggesting that the price is likely to pull back from here.

 The potential downside price target is $15.25.

Challenger Financial Svcs (CGF) – At resistance

The down trend from the December 2017 high has lost momentum over the past seven months and the price has been trading sideways, fluctuating between $6.22 and $8.84.

The current medium term rally is still in progress and is likely to fill the gap.

This means the price could rise further to $9.15 in the near term.

Although, at this point there is no reversal signal evident on the chart, given the proximity to overbought momentum levels on the weekly and daily charts, at current price levels we rate the stock as a hold.

Redbubble (RBL) – At support

RBL has been trading sideways over the past two years, fluctuating between $0.82 and $2.08.

The current downswing retraced close to its key support which appears solid and is likely to hold.

Over the past month, the price action appears to be in the process of building a small base and we see a good probability of the price rising in the near term.

The first potential upside price target is $1.10, followed by $1.20.

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.

Add your comment

 
 

 
  • Print this page
  • Copy Link