Technical Analysis: 21 January 2021

About the author:

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

Ansell (ANN) – Buy

After posting a record high of $43.17 in November 2020 and reaching overbought momentum levels a pull back to unwind the overbought momentum conditions took place.

The price retraced to $33.23 in December 2020 which is likely to act as a strong support.

Wednesday’s price action broke above minor resistance of $36.17 confirming a small ascending triangle. The pattern has bullish implications and suggests that the correction is likely to be complete and that higher prices are likely to unfold in the coming weeks.

The RSI indicator completed an inverse head and shoulders pattern from oversold territory, adding further confidence the correction is complete.

The first potential upside price target based on the breakout is $39.00 followed by $42.00 over the medium term.

Sonic Healthcare (SHL) – Double Blessed Buy

The strong up trend from the March 2020 low has lost momentum over the past five months and the price has been trading sideways, fluctuating between $31.11 and $38.00.

The latest pull back has lost momentum over the past month and the price has been in the process of building a small base above its key support.

The leading RSI indicator has completed a bottom reversal pattern suggesting that the price is likely to follow suit.

A decisive break above minor resistance of $34.15 is likely to occur and would confirm the completion of an ascending triangle.

The first potential upside price target based on the breakout is $36.00 followed by $38.00 in the month(s) ahead.

Fisher & Paykel Healthcare (FPH) - Buy

The primary up trend has lost momentum over the past six months and the price has been trading sideways, fluctuating between $28.59 and $34.92.

The recent pull back has retraced to its key support from where the price is likely to bounce.

The down trend line on the RSI indicator has been broken upwards suggesting that the correction is likely to be complete.

Given the proximity to key support and the improvement in the momentum conditions, we are comfortable to buy the stock at current price levels.

The first potential upside price target is $33.00 followed by $34.80 in the weeks ahead.

NEXTDC (NXT) – Buy

NXT has been trading in a consistent up trend over the past year which is still technically intact.

The current pull back has clearly lost momentum and the price has been in the process of building a small base over the past month.

A higher low has formed on the daily chart over the past few days showing that building interest is building up.

The stochastic indicator has turned up from oversold territory suggesting that the price is likely to bounce in the short-term.

The RSI and the MACD indicators are turning higher from oversold territory suggesting that higher prices are likely to unfold in the near-term.

A break above minor resistance of $12.51 is highly likely in our view, which would confirm the correction is complete and is likely to trigger higher prices.

The potential upside price target is $14.00. We see the current price levels as attractive to buy the stock.

Data#3 (DTL) - Accumulate

DTL has been trading in a strong primary up trend which is still technically intact.

After posting a fresh record high of $7.30 and reaching overbought momentum levels a pull back to unwind the overbought and diverging momentum conditions took place.

The price declined to its previous support of $5.01 where strong buying interest has been building up over the past month.

A higher low has formed on the daily chart suggesting that the price might be approaching a turning point.

The leading RSI indicator completed a bottom reversal pattern from oversold territory suggesting that higher prices are likely to unfold in the weeks ahead.

A subsequent break above minor resistance of $5.92 is highly likely in our view and would confirm that a new secondary up trend is starting.

The potential upside price target on the anticipated breakout is $6.90.

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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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