Technical analysis: 27 July 2020

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
27 July 2020, 12:00 PM

Cardno (CDD) – Bullish breakout

CDD has been trading in a primary down trend since August 2012 which is still technically intact.

The recent price action has declined to its previous primary support of $0.20 which appears strong and is likely to hold. An equal low has formed on the daily chart showing that buying interest is building up.

Friday’s price action broke above resistance of $0.315 and has confirmed a secondary double bottom.

The pattern has bullish implications and suggests that higher prices are likely to unfold in the coming months. The potential upside price target based on the breakout is $0.40.

Insurance Australia (IAG) – Heading lower

The down trend from the July 2019 high has lost momentum over the past four months and the price has been trading sideways, fluctuating between $5.00 and $6.49.

Friday’s price action broke below minor support of $5.55 and has confirmed a bearish descending triangle pattern.

The stochastic indicator has turned down from overbought territory suggesting that the price is likely to decline in the short term.

The initial downside price target is $5.00, however if that level of support is breached, lower prices could unfold in the coming months.

Shine Justice (SHJ) – Short term bounce

SHJ has been trading sideways over the past two years, fluctuating between $0.60 and $1.03.

The current down swing has retraced to its previous support, where initial buying interest is likely to arise.

The RSI and the MACD indicators have turned up from oversold territory suggesting that higher prices could unfold in the near term.

The initial upside price target is $0.72. Over the medium term, our view on the stock is neutral and we favor further sideways trading in the coming months.

Bank of Queensland (BOQ) – In a down trend

The rally from the May 2020 low has lost momentum over the past month and the price has been trading sideways, fluctuating within the boundaries of a descending triangle pattern.

The stochastic indicator has turned down from overbought territory suggesting that the price could pull back in the short term.

A break below minor support of $6.04 is likely and would confirm the bearish pattern.

The initial downside price target based on the anticipated breakout is $5.50.

Over the long term, the primary down trend remains intact, the weekly momentum indicators are firmly in the bear market range and at this juncture of time we don’t see a sign of a reversal.

Credit Corp Group (CCP) – Short term weakness

The rally from the March 2020 low has lost momentum over the past month and the price has been trading sideways, fluctuating between $14.83 and $17.98.

The stochastic indicator has turned down from overbought territory suggesting that the price is likely to decline in the short term.

The initial downside price target is $15.00. The expected short term share price weakness would provide an opportunity to accumulate the stock.

Over the medium term, the stock is likely to continue to trade sideways, potentially fluctuating between $13.50 and $20.00.

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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