Hot Money Monday: Two nanocap market minnows were in demand last week

Stockhead’s Hot Money Monday 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 look-out for opportunities where the price action has separated from fundamentals.

Volatility on the ASX saw the number of stocks with a 14-day RSI half to just 16, down from 32 in the week prior.
 

Running Hot

Here’s a summary of the stocks that were running hot for the two weeks ended Friday, March 5:

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

Investment company Mariner Corp (ASX:MCX) chalked up a red-hot RSI rating, which appeared to be driven by a 150pc surge on Thursday on no news.

The sub-$5m nanocap released its interim financial report in the week prior, which showed a 94 per cent fall in revenues to $12,713.

MCX booked a loss for the period of $324,407, and finished the year with $200,976 cash in the bank — a possible case of the RSI price action diverging from fundaments.

Obscure resources play Viagold Rare Earth Corp (ASX:VIA) also recorded a somewhat bizarre RSI reading after climbing in Thursday trade.

Earlier last week, the infrequently traded company announced it had passed a resolution of shareholders to expand its capital base by another 100,000,000 ordinary shares at a par value 20c.

Digital wealth advisory platform InvestSMART Group (ASX:INV) also ran hot after announcing last Tuesday that it had raised $17.68m for its Ethical Share Fund, which will operate as an ASX-listed exchange traded managed fund (ETF) (ASX: INES).

Running Cold

Here’s a summary of the stocks that were running cold for the two weeks ended Friday, March 5:

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