Technical analysis: 11 September 2020

About the author:

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

Adbri (ABC) – Target reached

In our last update on the 10th of July 2020 we discussed the oversold nature of the stock and the likelihood of the price trading higher in the short-term.

A slow but steady rally has unfolded over the past two months and our medium-term upside price target of $2.60 has now been reached and exceeded.

Although at this juncture in time we don’t see a reversal of the rally, we note the proximity of the price to its gap resistance of $2.95 and the overbought daily momentum conditions.

Therefore, we are of the view that the short-term upside from here is likely to be limited and the price is vulnerable to a pull back in the short-term.

The recent higher low is the first encouraging sign since the primary down trend has started in July 2018 and shows that buying interest started building up.

However, before a clear improvement in the momentum conditions we would remain cautious and favour sideways trading in the coming months.

The A2 Milk Company (A2M) – Target reached

In our last update on the 10th of July 2020 we discussed the overbought and deteriorating momentum conditions on the daily chart and the likelihood of the price trading lower in the short-term.

The expected pull back has unfolded over the past month and our initial downside price target of $18.00 has now been reached and exceeded.

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

While our ideal buy entry is in the range between $14.00 and $15.00, given the oversold momentum readings we are comfortable to start accumulating around current price levels.

The potential medium-term upside price target is $20.00.

Technology One (TNE) – Oversold

TNE has been trading sideways over the past year fluctuating between $6.36 and $10.26.

After posting a fresh all-time high of $10.26 in May 2020 and reaching overbought momentum levels a pull back to unwind the overbought momentum conditions took place.

The pull back has been unfolding within the boundaries of a down trend channel with the current short-term down swing approaching its channel line crossing at $7.20, where initial support is likely to arise.

The weekly RSI indicator has approached oversold territory suggesting that the price is likely to bounce soon.

The initial short-term upside price target is $8.50. Over the medium-term, levels to $9.50 are achievable.

IOOF Holdings (IFL) – Oversold

The recovery from the March 2020 low has lost momentum and over the past two months the price has been trading in a correction mode.

The current down swing is approaching a band of support between $2.50 and $3.01, where buying interest is likely to arise.

The daily RSI indicator has reached oversold territory suggesting that the price is likely to bounce soon.

We see any further short-term share price weakness below $3.00 as an opportunity to accumulate the stock.

The potential upside price target is $3.85.

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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