Technical Analysis: 26 November 2020
About the author:
- Author name:
- By Violeta Todorova
- Job title:
- Senior Technical Analyst
- Date posted:
- 26 November 2020, 8:30 AM
Orocobre (ORE) – Lifting our target
In our last update on the 20th of November 2020 we discussed the improving structure of the price chart and the likelihood of the price trading higher in the near-term.
A strong rally has unfolded over the past week and our second price target of $3.96 has now been reached.
The monthly momentum indicators have completed a bottom reversal pattern, strengthening our view that a large inverse head and shoulders pattern is likely to be completed and confirmed at some point.
A subsequent break above key resistance of $3.96 is highly likely in our view, which would suggest that a new primary up trend has started.
The potential long-term upside price target based on the anticipated breakout is $4.80.
Nanosonics (NAN) - Approaching resistance
In our last update on the 5th of November 2020 we discussed the oversold momentum conditions and the likelihood of the price trading higher in the short-term.
A strong rally has unfolded over the past few weeks and the current up swing is approaching our second upside price target of $7.00, which is a previous multiple resistance for the stock.
The RSI and the stochastic indicators have reached overbought territory suggesting that the rally is likely to pause soon.
Given the proximity to previous resistance and the overbought momentum readings, we are of the view that the short-term upside from here is likely to be limited.
Emeco Holdings (EHL) – Improvement in momentum
The secondary down trend from the June 2018 high has found solid support at $0.45 and over the past nine months the price has been in the process of building a large base.
The weekly RSI indicator completed a bottom reversal pattern, suggesting that higher prices are likely to unfold in the coming weeks.
The daily RSI indicator entered its bull market range for the first time over the past two years, showing significant improvement in momentum.
Despite the overbought momentum readings, which may cause a mild pull back in the short-term, we are of the view that subsequently the price is likely to extend its march higher. The initial upside price target is $1.30.
New Hope Corporation (NHC) – Heading higher
NHC has been trading in a strong secondary down trend since March 2019 which is still technically intact.
The down trend has clearly lost momentum over the past eight months and the price has been trading sideways, fluctuating between $1.01 and $1.65.
The daily RSI indicator has entered its bull market range suggesting that higher prices are likely to unfold in the month(s) ahead.
The weekly RSI indicator completed a large bottom reversal pattern, pointing to higher price levels over the medium-term.
The first potential upside price target is $1.65, which is a key resistance for the stock and is an important level to monitor.
Given the improvement in the daily and the weekly momentum conditions, we are of the view that a subsequent break above resistance is likely to occur, which is likely to trigger an extension of the current rally to $1.80.
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.
You are also welcome to start a two-week trial of our online platform, which provides access to detailed market analysis and insights, provided by our award-winning research team. Please contact your Morgans adviser or nearest Morgans office for further assistance.
Create trial account
Find local branch
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.