Technical Analysis: 14 January 2021

About the author:

Violeta Todorova
Author name:
By Violeta Todorova
Job title:
Senior Technical Analyst
Date posted:
14 January 2021, 9:30 AM

Aurizon Holdings (AZJ) – Double Blessed Buy

AZJ has been trading sideways over the past five years, fluctuating between $3.35 and $6.11. The current secondary down trend is approaching its band of support between $3.35 and $3.72, where initial buying interest is likely to arise.

The RSI indicator has reached oversold territory suggesting that the price is likely to rebound soon. A small bullish divergence between the price and the stochastic indicator has formed over the past month pointing to a likely rally in the short-term.

Given the proximity to a band of support and the oversold momentum conditions, we see the current share price weakness as an opportunity to buy the stock. The first potential upside price target is $4.20 followed by $4.40.  

Ramelius Resources (RMS) – Double Blessed Buy

RMS has been trading in a secondary down trend since September 2020 which is still technically intact. The down trend has clearly lost momentum over the past month with the price forming almost equal lows.

A bullish divergence between the price and the RSI indicator has formed throughout November 2019 and January 2020 suggesting that the correction might be approaching a turning point.

The down trend has lost momentum around its previous key resistance of $1.48 which is likely to act as a support. The current down swing has retraced to its support, where buying interest is likely to start building up.

Given the proximity to its previous key resistance and the oversold and diverging daily momentum readings, we see the current price action as attractive to open long positions. The first potential upside price target is $1.80. Over the medium-term, levels to $2.30 appear easily achievable.  

Eagers Automotive (APE) – Tracking well

APE has been trading in a strong secondary up trend since March 2020 which is still firmly intact. The price action is trading well above its medium-term up trend line showing that momentum is still strong.

The RSI indicator remains firmly in its bull market range indicating that momentum is still strong and constructive.

The RSI, the MACD and the stochastic indicators have reached oversold territory suggesting that the price is likely to bounce in the short-term. The first potential upside price target is $14.80, however over the medium-term, higher price levels appear achievable.   

Poseidon Nickel (POS) – Ready to breakout

POS has been trading in a strong secondary up trend since March 2020 which is still technically intact. The up trend has lost momentum over the past three months and the price has been trading sideways, fluctuating between $0.061 and $0.097.

On Wednesday the RSI indicator broke above its bear market resistance suggesting that the price is likely to follow suit and break above minor resistance of $0.078.

The MACD indicator has turned higher from oversold territory also pointing to a likely rebound in the short-term. Upon confirmation a rapid rally is likely to unfold in the coming weeks, with a potential upside price target of $0.095.

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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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