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 lookout 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, January 21:
| Code | Company | Price | RSI | MktCap$ |
|---|---|---|---|---|
| AHK | Ark Mines Limited | 22.0% | 72.99 | $6,833,223 |
| GL1 | Globallith | 162.0% | 72.22 | $245,017,033 |
| BRN | Brainchip Ltd | 170.5% | 77.77 | $3,403,008,856 |
| QXR | Qx Resources Limited | 4.4% | 70.21 | $29,847,942 |
| CAV | Carnavale Resources | 1.6% | 78.57 | $29,162,764 |
| AS2 | Askarimetalslimited | 38.5% | 72.08 | $11,820,060 |
| DCX | Discovex Res Ltd | 1.1% | 73.33 | $28,255,305 |
| CHR | Charger Metals | 80.5% | 70.78 | $28,347,466 |
| ZAG | Zuleika Gold Ltd | 4.2% | 78.57 | $17,223,922 |
| RNU | Renascor Res Ltd | 23.8% | 75.00 | $510,449,445 |
| AZL | Arizona Lithium Ltd | 17.0% | 74.63 | $365,783,170 |
| DM1 | Desert Metals | 44.5% | 72.73 | $17,118,300 |
| ADO | Anteotech Ltd | 36.5% | 83.87 | $730,403,825 |
| SFM | Santa Fe Minerals | 22.0% | 73.91 | $16,020,134 |
| KFM | Kingfisher Mining | 31.0% | 76.92 | $11,643,300 |
Despite a sharp fall to end the week, Brainchip (ASX:BRN) still posted a 14-day RSI above 70 following its latest massive rally in January.
While BRN didn’t escape the broader unwind taking place across global markets, the ASX’s hottest AI chip technology developer still closed the week with a market cap north of $3bn.
Another stock that jumped onto the hot-money list was Zuleika Gold (ASX:ZAG), and not just because of the broader lift in gold stocks as market risk appetite wanes.
The junior explorer also got the thumbs-up from leading mining investor Mark Creasy, who tipped in $3m to fund drilling programs at ZAG’s gold projects in Kalgoorlie.
Surface management technologies company Anteotech (ASX:ADO) also ran hot, following steady gains on no news which have seen ADO’s share price more than double — from 16c to 37c — since the middle of December.
Running Cold
Here’s a summary of the stocks that were running cold for the two weeks ended Friday, January 21:
| Code | Company | Price | RSI | Market Cap |
|---|---|---|---|---|
| AEF | Australian Ethical | 10.06 | 18.24 | $1,218,276,576 |
| ZBT | Zebit Inc. | 0.23 | 21.62 | $21,766,099 |
| DUB | Dubber Corp Ltd | 2.04 | 23.33 | $663,181,068 |
| SZL | Sezzle Inc | 2.3 | 24.32 | $496,223,573 |
| PME | Pro Medicus Limited | 45.43 | 25 | $4,731,831,568 |
| ABY | Adore Beauty | 3.27 | 25.32 | $316,258,310 |
| DVP | Develop Global Ltd | 3.2 | 25.93 | $471,338,347 |
| PCH | Property Connect | 0.0015 | 26.13 | $1,028,795 |
| CGS | Cogstate Ltd | 1.895 | 26.19 | $402,137,195 |
| KFE | Kogi Iron Ltd | 0.01 | 27.12 | $13,175,778 |
| ECG | Ecargo Hldg | 0.03 | 27.76 | $18,457,500 |
| RBL | Redbubble Limited | 2.06 | 28.82 | $579,432,468 |
After reaching new all-time highs of almost $14 over the Christmas period, shares in ethical wealth management company Australian Ethical (ASX:AEF) have cooled off to start the year.
Shares in AEF fell on 11 of 14 trading days from January 4 to January 21, and a sharp +8% fall on Friday saw the stock fall back below $10 for the first time since September.