Technical analysis: 10 September 2020

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
10 September 2020, 4:40 PM

Medibank (MPL) – Target reached

In our last update on the 30th of July 2020 we discussed the implications from the breakout of the descending triangle pattern and the likelihood of the price trading lower in the near term.

A strong decline has unfolded over the past two weeks and our initial downside price target of $2.74 has now been reached and exceeded.

The current down swing has retraced to its March 2020 low of $2.45 and is near its key support level of $2.29, which appears solid and is likely to hold.

The RSI and the MACD indicators have reached oversold territory suggesting that the price is likely to bounce in the short term.

The initial upside price target is $2.70. At this point the momentum conditions remain weak and we favour further sideways trading in the coming months.

Coles group (COL) - Buy

Coles Group (ASX:COL) has been trading in a secondary up trend since March 2019 which is still technically intact.

The current short-term pull back has retraced to its medium-term up trend line crossing at $16.70 where initial buying interest is likely to arise.

The RSI and the MACD indicators have reached oversold territory suggesting that the price is likely to bounce in the short-term.

The initial upside price target is $18.00, however over time levels to $19.00 are achievable.

Given the proximity to dynamic support and the oversold momentum conditions, we see current price levels as attractive to buy the stock.

Zip Co (Z1P) – Approaching support

Zip Co (ASX:Z1P) 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 medium-term up trend line crossing at $6.00 where initial buying interest is likely to arise.

The RSI indicator has declined to its latest support of 44% suggesting that the price is likely to bounce in the short-term.

The stochastic indicator has reached oversold territory also pointing to a likely bounce in the coming week.

The potential upside price target is $7.80.

Given the strong rally over the past six months and the overbought weekly momentum conditions, we are of the view that the secondary up trend is likely to take a breather in the coming months.

QUBE Holdings (QUB) – Bearish breakout

The rally from the March 2020 low has lost momentum over the past three months and the price has been trading sideways, fluctuating between $2.62 and $2.98.

The leading RSI indicator broke below its bull market support showing that momentum is deteriorating.

This suggests that a subsequent break below minor support of $2.62 is likely which could trigger a decline to $2.40 in the coming weeks.

The weekly momentum conditions remain weak at this point and we favour some consolidation in the coming months.

Kelly Partners (KPG) - Overbought

Kelly Partners (ASX:KPG) has been trading in a strong secondary up trend since March 2020 which is still technically intact.

The weekly and daily RSI and MACD indicators have reached strongly overbought territory suggesting that the price is vulnerable to a pull back in the short-term.

Overall, the momentum conditions have improved significantly over the past two months, with the weekly RSI breaking above its bear market resistance, which suggests that the price is likely to trade higher in the long-term.

The potential long-term upside price target is $1.35.

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.

  • Print this page
  • Copy Link