Hot Money Monday: The most in-demand stocks on the ASX right now
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The relative strength index (RSI) is an important technical indicator for stock traders.
It provides a measure of which stocks are most in demand, and which stocks investors are neglecting.
Often, changes in the RSI are reflective of market reactions to market announcements or changes in earnings forecasts.
But it can also offer a gauge on which stocks may be running ahead of their earnings fundamentals, and alternatively which companies might be running under the radar.
Each week, Stockhead provides a simple summary of outliers on the RSI, to get a technical gauge of how trading momentum is affecting the price action.
A reading of 70 is seen as the level at which a company’s been overbought. If a stock has a reading of 30 or below, it may be undervalued.
Here’s this week’s list:
Topping the list for the second straight week — a relatively rare feat in Hot Money — was WA gold miner Tribune Resources (ASX: TBR).
The stock posted a two-week RSI of 87.95, cooling off slightly from the prior fortnightly reading of 90.5. But the share price is still climbing, up to $7.63 from the previous Friday’s close of $7.11.
That marks a gain of 77 per cent since the start of June — a period in which the company hasn’t made a single announcement to the market.
Behind the scenes, the company may still be the subject of tug-of-war between two larger players — Evolution Mining (ASX:EVN) and Northern Star Resources (ASX:NST).
Also running hot this past fortnight was Cynata Therapeutics (ASX: CYP), which confirmed on Friday it had received a non-binding takeover offer from Japanese pharmaceutical company Sumitomo Dainippon priced at $2 per share.
And IT company Objective Corp (ASX: OCL) moved further up the list with an RSI of 82.68, after the share price climbed from $2.83 to $3.56 last week.
It followed a trading update which showed the company expects net profit after tax for the 2019 to be $9.1m, driven by strong growth in its subscription-revenue product lines.
Here’s a summary of the stocks that were running hot for the two weeks ended Friday, July 19:
|Code||Name||RSI - 2 weeks||Price ($)||Market Cap|
|TBR||TRIBUNE RESOURCES LTD||87.95||7.55||410.72M|
|CYP||CYNATA THERAPEUTICS LTD||87.94||1.77||163.02M|
|OCL||OBJECTIVE CORPORATION LTD||82.68||3.55||329.72M|
|OVN||OVENTUS MEDICAL LTD||82.5||0.49||47.67M|
|SVL||SILVER MINES LTD||79.58||0.07||46.69M|
|TLX||TELIX PHARMACEUTICALS LTD||79.52||1.75||355.94M|
|SEN||SENETAS CORP LTD||79.41||0.09||91.91M|
|AFG||AUSTRALIAN FINANCE GROUP LTD||78.85||1.9||396.33M|
|LPI||LITHIUM POWER INTERNATIONAL||78.66||0.35||87.94M|
|IBX||IMAGION BIOSYSTEMS LTD||78.11||0.05||16.51M|
|GSN||GREAT SOUTHERN MINING LTD||77.97||0.05||14.56M|
|HCO||HYLEA METALS LTD||77.76||0.07||7.31M|
|EAR||ECHO RESOURCES LTD||77.67||0.22||145.13M|
|BGH||BLIGH RESOURCES LTD||77.31||0.14||42.98M|
|MDC||MEDLAB CLINICAL LTD||76.95||0.44||93.68M|
|AQI||ALICANTO MINERALS LTD||76.77||0.06||9.49M|
|CMM||CAPRICORN METALS LTD||76.47||0.17||156.79M|
|CAF||CENTREPOINT ALLIANCE LTD||76.15||0.14||17.87M|
|SM8||SMART MARINE SYSTEMS LTD||76.01||0.03||9.85M|
|LTR||LIONTOWN RESOURCES LTD||75.9||0.14||215.51M|
|BDA||BOD AUSTRALIA LTD||75.7||0.46||25.33M|
|JAY||JAYRIDE GROUP LTD||75.53||0.4||28.67M|
|MOD||MOD RESOURCES LTD||75.47||0.44||132.24M|
|IVR||INVESTIGATOR RESOURCES LTD||75.42||0.01||9.62M|
|MAQ||MACQUARIE TELECOM GROUP LTD||75.35||22.87||484.98M|
Among stocks with an RSI below 30, there may be some hidden gems that have been neglected by the market despite sound fundamentals.
But in general, the list is less volatile that stocks running hot — if the market is ignoring these companies, it’s usually for a reason.
Bringing up the rear this week was Superloop (ASX: SLC), after a letter from the chairman which cast doubt on the company’s profit guidance for the 2020 financial year (along with a downgrade to previous FY19 guidance).
It’s been a tough few months for the telecommunications company, which owns fibre networks that connect Australia with Asian markets in Singapore and Hong Kong.
A proposed takeover offer by the government-owned Queensland Investment Corporation at $1.90 fell through in May for unknown reasons. On Thursday, Superloop chairman Michael Malone said “negotiations of the transaction continue”. Shares in SLC closed on Friday at 97.5 cents.
These are the stocks that were running cold for the two weeks ended Friday, July 19:
|Code||Name||RSI - 2 weeks||Price ($)||Market Cap|
|AON||APOLLO MINERALS LTD||29.85||0.04||6.89M|
|BLT||BENITEC BIOPHARMA LTD||29.76||0.05||13.11M|
|MHI||MERCHANT HOUSE INTL LTD||29.37||0.09||8.20M|
|JHC||JAPARA HEALTHCARE LTD||29.36||1.04||280.61M|
|LCT||LIVING CELL TECHNOLOGIES LTD||28.93||0.02||11.43M|
|TDO||3D OIL LTD||28.81||0.08||20.42M|
|SCN||SCORPION MINERALS LTD||28.61||0.004||708.10k|
|SDA||SPEEDCAST INTERNATIONAL LTD||27.5||1.81||442.32M|
|BRV||BIG RIVER GOLD LTD||26.76||0.01||9.25M|
|PUR||PURSUIT MINERALS LTD||26.68||0.01||2.68M|
|TNK||THINK CHILDCARE LTD||26.51||1.47||90.71M|
|KPE||KINA PETROLEUM CORP||26.08||1.1||14.10M|
|SYA||SAYONA MINING LTD||26.04||0.01||12.06M|
|ECT||ENVIRONMENTAL CLEAN TECHNOLOGY||25.21||0.004||19.20M|
|ARQ||ARQ GROUP LTD||23.79||0.67||81.22M|
|OLH||OLDFIELDS HOLDINGS LTD||23.07||0.03||2.79M|
|ANW||AUS TIN MINING LTD||22.93||0.01||15.23M|
|LHB||LIONHUB GROUP LTD||16.83||0.005||4.13M|
|OBM||ORA BANDA MINING LTD||16.77||0.15||72.96M|
|SHK||STONE RESOURCES AUSTRALIA LT||14.14||0.001||811.65k|