Technical Analysis: 19 February 2021

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
19 February 2021, 5:00 PM

Western Areas (WSA) – Tracking well

WSA has been trading in an up trend channel since March 2020 which is still technically intact.

The latest pull back has found strong support at $2.25 from where the price has bounced and has been trading higher over the past three weeks.

The weekly stochastic indicator has turned up from oversold territory suggesting that the price is likely to extend its march higher.

The daily MACD indicator has crossed from oversold territory and points to higher prices in the months ahead. The first potential upside price target is $3.00.

Over the long-term, levels to $3.30 appear achievable. Any short-term share price weakness would provide an opportunity to add to positions.

Lovisa (LOV) – Lifting our target

LOV has been trading in a strong up trend channel since March 2020 which is still technically intact.

The rally took a breather over the past two months and the price has been trading sideways, fluctuating between $10.13 and $12.42.

Friday’s price action decisively broke above its resistance and has confirmed a rectangle pattern. The pattern has bullish implications and suggests that the secondary up trend is likely to extend further.

The momentum indicators are constructive and firmly in the bull market range, also pointing to higher prices.

We see a good probability of the price rebounding to its channel line, therefore we lift our price target from $3.80 to $14.10.

PWR Holdings (PWH) – Bullish breakout

The secondary up trend from the March 2020 low has lost momentum over the past five months and the price has been trading sideways, fluctuating between $4.34 and $5.28.

Friday’s price action broke above its minor resistance of $4.70 suggesting that the latest down swing is now complete and that higher prices are likely to unfold in the short-term.

The daily RSI and stochastic indicators have turned up from oversold territory suggesting that higher prices are likely to unfold in the week(s) ahead.

Given today’s price gap, we are of the view that buying interest is likely to increase and lift our previous price target of $5.10 to $5.20.

Carsales.com (CAR) - Overbought

CAR has been trading in a strong up trend since March 2020, which appears to have started losing momentum over the past few months.

The current up swing has rebounded to its previous resistance of $22.99 where selling pressure started building up.

The daily RSI and MACD indicators started turning lower from overbought territory suggesting that the price is likely to pull back in the short-term.

A decisive break below minor resistance of $21.21 would confirm that a short-term top is in place and is likely to trigger a pull back to $20.00, however this level could be exceeded.

Mirvac Group (MGR) – Approaching support

MGR has been trading in a choppy secondary up trend since March 2020 which is still technically intact.

The current pull back is approaching a band of support between $2.01 and $2.11 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 soon.

Given the proximity to a band of support and the oversold momentum levels, we are comfortable to start accumulating the stock around current price levels.

The first potential upside price target is $2.50 followed by $2.80 over the medium-term.

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Disclaimer: 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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