Hot Money Monday: The most in-demand stocks on the ASX right now

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Each Monday, Stockhead recaps which stocks are most heavily in demand by investors — running hot.

The analysis is based on the Relative Strength Index (RSI), 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

The Running Hot list continues to provide an interesting gauge around market sentiment, amid the broader volatility caused by COVID-19.

We’ve revised the RSI cutoff down to 60, and even with increased leniency the number of stocks on last week’s list only reached 11.

This week, it increased to 34, after US fiscal stimulus last week was followed up by the Morrison government’s $130bn package on Monday.

Health company Genetic Signatures (ASX:GSS) topped the list, after the company received CE Mark approval to sell its COVID-19 test kit in the UK and Europe.

Genetic Signatures said its testing kit could be used as a complement to its existing diagnostic systems, allowing for “rapid detection of up to 188 patient samples in approximately 4.5 hours”. Shares in the company jumped sharply on Tuesday after it came out of a four-day trading halt.

Here’s a summary of the stocks that were running hot for the two weeks ended Friday, April 3:

Scroll or swipe to reveal table. Click headings to sort.

Running Cold

As markets sold off in March, the Running Cold list required some serious trimming to account for the hundreds of companies with RSI readings below 30.

When the current bear market hit its peak two weeks ago, Stockhead only selected companies with an RSI below 15 (the list was still 99 stocks long).

This week, we’ve increased the RSI cutoff back up to 25, resulting in a total of 74 companies which aren’t seeing much demand amid the broader volatility.

Here’s a summary of the stocks that were running cold for the two weeks ended Friday, April 3:

Scroll or swipe to reveal table. Click headings to sort.

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