Each week, Stockhead recaps ASX stocks that are “running hot” as deduced by the Relative Strength Index (RSI).
The RSI is a technical gauge which measures how trading momentum is affecting the price action.
A reading of 70 is seen as the level at which a company may have been overbought. If a stock has a reading of 30 or below, it could be undervalued.
Click here for a more detailed rundown of what the RSI does and how it’s used.
While there’s usually a pretty good reason if a given stock is running hot (or cold), investors are also on the look out for opportunities where the price action has separated from fundamentals.
Running Hot
Here’s a summary of the stocks that were running hot for the two weeks ended Friday, July 16:
Scroll or swipe to reveal table. Click headings to sort.
| Code | Company | Price | RSI | MktCap$ |
|---|---|---|---|---|
| BRL | Bathurst Resources | 0.815 | 88 | $ 140,180,330.86 |
| YFZ | Youfoodz | 0.915 | 85 | $ 121,765,458.54 |
| MAQ | Macquarie Telecom Gp | 66.96 | 84 | $ 1,448,701,497.03 |
| ATU | Atrum Coal Ltd | 0.073 | 82 | $ 36,661,694.14 |
| FEL | Fe Limited | 0.089 | 82 | $ 58,795,382.02 |
| CKA | Cokal Ltd | 0.08 | 81 | $ 73,042,002.73 |
| AXE | Archer Materials | 1.32 | 81 | $ 290,070,846.15 |
| ICQ | Icar Asia Ltd | 0.48 | 80 | $ 205,518,066.71 |
| WSI | Weststar Industrial | 0.028 | 80 | $ 26,337,866.82 |
| RNO | Rhinomed Ltd | 0.215 | 80 | $ 54,568,963.38 |
| HMY | Harmoney Corp Ltd | 2.21 | 80 | $ 226,044,501.76 |
| OKR | Okapi Resources | 0.32 | 78 | $ 16,804,818.77 |
| CXZ | Connexion Telematics | 0.02 | 78 | $ 17,603,302.24 |
| RFG | Retail Food Group | 0.096 | 76 | $ 184,448,282.23 |
| NXM | Nexus Minerals Ltd | 0.105 | 76 | $ 23,926,863.76 |
| MIO | Macarthur Minerals | 0.625 | 76 | $ 78,743,915.60 |
| API | Australian Pharm. | 1.405 | 74 | $ 694,645,009.35 |
| JPR | Jupiter Energy | 0.061 | 73 | $ 5,674,974.64 |
| AJL | AJ Lucas Group | 0.036 | 73 | $ 43,066,318.86 |
| LBT | LBT Innovations | 0.11 | 73 | $ 31,802,668.04 |
| WTL | WT Financial | 0.086 | 73 | $ 14,376,783.40 |
| KOR | Korab Resources | 0.02 | 71 | $ 6,649,859.62 |
| DRE | Drednought Resources | 0.042 | 71 | $ 94,175,086.92 |
| ICE | Icetana Limited | 0.11 | 70 | $ 11,809,709.38 |
It was a good week for shareholders in Bathurst Resources (ASX:BRL), which secured a key victory in New Zealand court following a multi-year legal battle.
Shares in the company ran hot after NZ Supreme Court upheld BRL’s appeal against a lower-court judgment, which would have left it liable for a US$40m performance payment in connection with a 2010 deal to purchase coal assets from L&M Coal Holdings.
Two other companies ran hot following a round of M&A activity, including food delivery company Youfoodz (ASX:YFZ) which got a takeover priced at 93c (well below its 2020 listing price of $1.50).
Online car marketplace platform iCar Asia (ASX:ICQ) also came into the sights of a bigger player following a bid from Malaysia-based Carsome Group Pte Ltd.
Elsewhere, mid-cap stock Macquarie Telecom Group (ASX:MAQ) recorded a 14-day RSI of 84 after eight straight days of steady gains, capped off by a 15% jump on Wednesday when it announced application plans to build a new data centre at Macquarie Park Data Centre, and reconfirmed its full-year earnings guidance.
And there was an appearance from Retail Food Group (ASX:RFG), which has climbed from 7c to above 9c over the past week.
That marks a far cry from the halcyon days above $5 when the company oversaw a franchise network of more than 2,500 stores. The company has turned its focus in recent years to paying down debt and running a leaner store model.
Running Cold
Here’s a summary of the stocks that were running hot for the two weeks ended Friday, July 16:
Scroll or swipe to reveal table. Click headings to sort.
| Code | Company | Price | RSI | MktCap$ |
|---|---|---|---|---|
| BKY | Berkeley Energia Ltd | 0.325 | 29 | $ 80,284,389.00 |
| PCH | Property Connect | 0.0015 | 29 | $ 1,028,795.21 |
| PDZ | Prairie Mining Ltd | 0.22 | 28 | $ 50,238,119.58 |
| JCS | Jcurve Solutions | 0.052 | 27 | $ 18,058,889.15 |
| ORM | Orion Metals Ltd | 1.7 | 27 | $ 9,266,656.53 |
| SFG | Seafarms Group Ltd | 0.054 | 27 | $ 150,445,106.46 |
| CYC | Cyclopharm Limited | 1.66 | 26 | $ 156,869,702.64 |
| NPM | Newpeak Metals | 0.0015 | 20 | $ 11,408,322.60 |
| GMN | Gold Mountain Ltd | 0.026 | 19 | $ 19,193,123.10 |
| MHI | Merchant House | 0.05 | 16 | $ 4,713,324.80 |
| TOM | Tomizone Limited | 0.002 | 13 | $ 850,401.35 |
| MPX | Mustera Property Grp | 0.25 | 13 | $ 29,056,555.25 |
Among the stocks running cold this week was uranium play Berkeley Energia (ASX:BKY), which copped a regulatory blow when Spanish authorities declined to give the go-ahead for the construction of a uranium concentrate plant.
BKY said it will “strongly defend its position and will immediately consider the range of legal options available to it in relation to the adverse decision”.