Technical Analysis: 7 February 2020

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
07 January 2020, 9:50 AM

Gold Road Resources (GOR) – Target reached

In our last update on December 4, 2019 we discussed number of bullish developments emerging on the chart and the likelihood of the price rising in the short term.

Price rallied strongly over the past two months and our initial upside price target of $1.40 has been reached and exceeded.

While at this point there is no sign the rally is over, we note that the price is approaching its previous resistance of $1.65, where initial selling pressure is likely to arise. Active traders may consider lightening positions.

SomnoMed (SOM) – Target reached

In our last update on November 29, 2019 we discussed the improvement in the momentum conditions and the likelihood of the price trading higher in the near term.

A strong rally has unfolded over the past month and our initial upside price target of $3.30 has now been reached.

The current price action is close to its previous key resistance and the RSI indicator is in overbought territory.

Given the proximity to key resistance and the overbought momentum readings, we are of the view that the price is likely to take a breather in the short term and trade sideways.

HRL Holdings (HRL) – Bullish breakout

HRL has been trading sideways over the past ten months fluctuating between $0.092 and $0.13. Friday’s price action decisively broke above its key resistance of $0.13 suggesting that higher prices are likely to unfold in the months ahead.

The RSI indicator broke above its bear market resistance also pointing higher prices over the medium term.

Given the improvement in the momentum conditions and the bullish breakout on the daily chart, we see a good probability of the price filling the gap created during the November 2018 sell off.

This means that a rally to $0.16 has a high probability.

IRESS (IRE) – Target reached

In our last update on October 31, 2019 we discussed the implications from the breakouts on the RSI indicator on the price and highlighted that higher prices are likely to unfold over the medium term.

A consistent and steady rally has unfolded over the past few months and our initial upside price target of $13.50 has now been reached.

While at this point there is no reversal signal on the chart, we note the price proximity to key resistance of $14.77.

We see any further short term share price strength as an opportunity to lighten positions.

WiseTech Global (WTC) – Bullish breakout

The strong up trend from the March 2018 low has lost momentum over the past five months and the price has been trading in a correction mode.

A triple bullish divergence between the price and the RSI indicator has formed on the daily chart suggesting that the stock might be at a turning point.

The recent price action broke above its medium term up trend line and its minor resistance of $25.92 suggesting that the correction is likely to be over and that the price is likely to trade higher in the coming months.

The RSI indicator broke above its bear market resistance also pointing higher prices over the medium term.

The first potential upside price target is $30.00, however over the medium term higher prices are achievable.

Any short term share price weakness should be considered a great buying opportunity.

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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