Technical Analysis

ChartWatch ASX Scans: Origin Energy, Vulcan Energy, Ausgold, Lendlease, Corporate Travel Management, Collins Foods

Thu 23 May 24, 10:01am (AEST)
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Key Points

  • Interesting uptrends in today's Scan Lists include: Origin Energy (ORG), Vulcan Energy (VUL), and Ausgold (AUC)
  • Interesting downtrends in today's Scan Lists include: Lendlease Group (LLC), Corporate Travel Management (CTD), and Collins Foods (CKF)

This kicks off a daily article where I present scan lists based on my trend following technical analysis methodology. The goal of this series is to alert you to the best uptrends and downtrends in the Australian share market.

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Criteria for Uptrends List

  • Short term uptrend (ST trend ribbon is light green)

  • Long term uptrend or long term trend is transitioning from down to up (LT trend ribbon is dark green, or LT trend ribbon is amber and contracting)

  • Demand-side price action (rising peaks and rising troughs is preferred, but based upon weight of evidence of other criteria rising peaks only or rising troughs only may be permitted)

  • Predominance of demand-side candles (i.e., white bodies and or downward pointing shadows)

  • The last candle in particular is a strong demand-side candle

Criteria for Downtrends List

  • Short term downtrend (ST trend ribbon is light pink)

  • Long term downtrend or long term trend is transitioning from up to down (LT trend ribbon is dark pink, or LT trend ribbon is amber and contracting)

  • Supply-side price action (falling peaks and falling troughs is preferred, but based upon weight of evidence of other criteria falling peaks only or falling troughs only may be permitted)

  • Predominance of supply-side candles (i.e., black bodies and or upward pointing shadows)

  • The last candle in particular is a strong supply-side candle


Uptrends List

Company

Code

1mo %

1yr %

The A2 Milk Company

A2M

+19.6%

+27.3%

AGL Energy

AGL

+12.5%

+17.9%

BetaShares Asia Technology Tigers ETF

ASIA

+11.8%

+29.0%

Ausgold

AUC

+25.8%

-20.4%

Bisalloy Steel Group

BIS

+22.4%

+107.9%

Centuria Capital Group

CNI

+3.2%

+1.7%

BetaShares Global Healthcare Hedged ETF

DRUG

+5.9%

+11.5%

Dexus Industria Reit.

DXI

+4.8%

+5.9%

Elevate Uranium

EL8

+29.5%

+98.4%

Fenix Resources

FEX

+14.3%

+36.2%

Gold Hydrogen

GHY

+59.5%

+505.8%

Hillgrove Resources

HGO

+14.5%

+61.1%

iShares Asia 50 ETF

IAA

+11.2%

+13.6%

Latin Resources

LRS

+36.6%

+64.7%

Macquarie Group

MQG

+4.9%

+10.9%

Vaneck Australian Banks ETF

MVB

+7.0%

+19.0%

National Australia Bank

NAB

+4.2%

+29.8%

Origin Energy

ORG

+3.5%

+22.1%

PM Capital Global Opportunities Fund

PGF

+10.3%

+26.2%

Platinum International Fund ETF

PIXX

+5.5%

+2.8%

Redox

RDX

+7.0%

0%

Rio Tinto

RIO

+4.9%

+24.4%

Southern Cross Electrical Engineering

SXE

+41.5%

+155.0%

Technology One

TNE

+10.9%

+17.3%

VGI Partners Global Investments

VG1

+3.3%

+16.4%

Vulcan Energy Resources

VUL

+85.8%

+26.4%

WIA Gold

WIA

+25.0%

+224.1%

Wisetech Global

WTC

+12.1%

+40.5%

Today's uptrends List

Interesting charts from today's Uptrends List 🔎📈

Origin Energy (ASX:ORG)

Origin Energy (ASX-ORG) chart 23 May 2024
Origin Energy chart

This is an interesting example of what I call an uptrend "continuation" setup. Continuation setups have well-established short and long term uptrends. These trends are consistent with a state of entrenched excess demand.

One of the most important aspects of uptrend continuation setups is that the short and long term uptrend ribbons have demonstrated an excellent track record of providing dynamic demand to the price.

Therefore, on both points, ORG appears to be a text book example of an uptrend continuation pattern. Other attributes that further confirm demand-side control include rising peaks and rising troughs (price action), and a predominance of demand-side candles.

Ausgold (ASX: AUC)

Augold (ASX-AUC) chart 23 May 2024
Ausgold chart

This is an interesting example of what I call an uptrend "turnaround" setup. Turnaround setups ideally have well-established short term uptrends, but do not have a well established long term uptrend. It is important, however, that the long term trend is in the process of transitioning from down to up.

The key to confirming the long term trend change is a pull back, test, and hold of the long term uptrend ribbon – indicating it has transitioned from an area of dynamic supply (as it was on the way down) to an area of dynamic demand.

This is a particularly early stage example of an uptrend turnaround setup (I will show you a more advanced example next). Note the downward pointing shadow on the 21 May candle reaches down to the long term trend ribbon? This suggests that on that intraday pullback, excess demand was indeed encountered.

The AUC price action is yet to show a well-established short term uptrend or rising peaks and rising troughs (again it is very early stage – but it’s the closest of any in the list to this type of setup so I wanted to use it as a case study today!). AUC does, however, show strong demand-side candles since 20 May.

Accompanying those demand-side candles is a significant spike in volume which indicates both a commensurate spike in interest, as well as crucial supply removal.

Vulcan Energy Resources (ASX: VUL)

Vulcan Energy Resources (ASX-VUL) chart 23 May 2024
Vulcan Energy Resources chart

This is an interesting example of a more progressed uptrend turnaround setup. Its like a potential fast-forward into the future for the AUC chart (I emphasise the word “potential” here!).

VUL first became a turnaround setup in mid-April - early-May when it started printing points of demand (troughs) in the long term uptrend ribbon.

This is a great case study because it demonstrates how the process of long term uptrend transition can take some time to play out.

Importantly, before it began to interreact with the long term trend ribbon, the VUL short term uptrend became well-established, and rising peaks and rising troughs became the norm – not the exception.

Increasing volume through the transition phase is common and necessary – again, it represents increasing interest and supply-removal (if you want to get rid of the dead-wood supply stuck in these failed stocks – you must trade with them – and that means volume!).

The long white candles on 10 and 11 April were the key to drawing this one to my attention as a turnaround setup – they are excellent showings of excess demand. The 8 May demand-side candle is the one which made VUL a “lock” for a turnaround setup.


Downtrends List

Company

Code

1mo %

1yr %

AMP

AMP

-3.2%

-2.3%

Aurizon Holdings

AZJ

-5.1%

+4.5%

Bapcor

BAP

-24.8%

-32.3%

Brickworks

BKW

-2.0%

+4.9%

Bluescope Steel

BSL

-7.1%

+9.9%

Brambles

BXB

-8.8%

-1.6%

Credit Corp Group

CCP

-15.9%

-16.4%

Collins Foods

CKF

-9.4%

+0.8%

Corporate Travel Management

CTD

-5.1%

-31.9%

De Grey Mining

DEG

-13.3%

-22.4%

Domain Holdings Australia

DHG

-6.0%

-18.1%

Domino's Pizza Enterprises

DMP

-1.5%

-25.3%

Data#3

DTL

-7.8%

+1.0%

Dexus

DXS

-1.5%

-12.9%

Endeavour Group

EDV

-8.6%

-21.5%

Insignia Financial

IFL

-4.7%

-26.3%

Johns Lyng Group

JLG

+1.2%

-13.3%

Karoon Energy

KAR

-10.5%

-10.0%

Kelsian Group

KLS

-5.8%

-21.2%

Lendlease Group

LLC

-5.6%

-23.8%

Metcash

MTS

-3.8%

-2.6%

Nine Entertainment Co. Holdings

NEC

-5.2%

-26.4%

NIB Holdings

NHF

-6.6%

-13.6%

Nufarm

NUF

-1.0%

-11.8%

Orora

ORA

-2.3%

-31.5%

Perpetual

PPT

-10.1%

-10.1%

Seek

SEK

-8.6%

-6.3%

Smartgroup Corporation

SIQ

-16.3%

+16.3%

Super Retail Group

SUL

-15.1%

+1.6%

Tabcorp Holdings

TAH

-10.5%

-41.8%

Telstra Group

TLS

-7.6%

-21.7%

Woodside Energy Group

WDS

-3.0%

-18.9%

Today's downtrends list

Interesting charts from today's Downtrends List 🔎📉

Lendlease Group (ASX: LLC)

Lendlease Group (ASX-LLC) chart 23 May 2024
Lendlease Group chart

This is an interesting example of what I call a downtrend "continuation" setup. I'm not going to spend long on these next three, because to understand them you just need to do the exact opposite of an uptrend continuation setup's trends, price action, and candles.

The LLC chart shows well-established short and long term downtrends, consistent with a prolonged period of excess supply. Importantly both trend ribbons are offering stiff dynamic supply whenever they're encountered.

Falling peaks and falling troughs, and a predominance of supply-side candles complete the set as far as supply-side control is concerned.

A complete lack of volume demonstrates a commensurate lack of interest among market participants in picking up shares of LLC "cheap".

I haven't addressed so far the concept of support and resistance, which I instead prefer to call "points of demand" and "points of supply" respectively. It is clear that $6 is a key point of demand for LLC. If LLC's price should close below it, it likely indicates that demand at this point has been exhausted.

Collins Foods (ASX: CKF)

Collins Foods (ASX-CKF) chart 23 May 2024
Collins Foods chart

This is an interesting example of what I call a downtrend "turnaround" setup. Again, do the opposite of an uptrend turnaround setup! Most important in any downtrend turnaround setup is observing the trend ribbons acting as dynamic supply.

Here we can see clearly how once the long term trend ribbon became entrenched as an area of dynamic supply, it was a slippery slope for CKF.

Yesterday's long black candle on a volume spike is an excellent example of excess supply. It also demonstrates plenty of demand was likely removed from the system.

Corporate Travel Management (ASX: CTD)

Corporate Travel Management (ASX-CTD) chart 23 May 2024
Corporate Travel Management chart

This is an interesting example of a more progressed downtrend turnaround setup. Again, hit the fast-forward button on CKF and it might end up looking like CTD!

I wanted to include this one due to the tremendous gap down on 21 Feb. Note also the massive volume spike on this day. Gaps of this magnitude represent a major shift in thinking among market participants about the future earning prospects of CTD.

Big gaps like this one are the epitome of excess supply. It didn't take long after the gap for the short term trend ribbon to do its job, and as they say in the classics, the rest is history from there.


Important considerations when using the ChartWatch ASX Scan Lists:
1. The future is unknown. Anything can happen to change the trends in the lists above. A stock in a perfect uptrend or downtrend may not remain that way by the close of trading today. 2. These lists are not exhaustive, they are curated by Carl. You will find that certain stocks might not appear in a particular list on consecutive days but might reappear when Carl feels it deserves to return to the list. 3. This is not a recommendation service, merely an aid to help you better understand the workings of Carl’s technical analysis model in a practical way. Carl will not alert you to stocks that have dropped off a list because their trend has changed – it is up to you to apply the criteria to determine why a particular stock might not still be included. 4. This is general, educational information only – always do your own research.

 

Written By

Carl Capolingua

Content Editor

Carl has over 30-years investing experience, helping investors navigate several bull and bear markets over this time. He is a well respected markets commentator who specialises in how the global macro impacts Australian and US equities. Carl has a passion for technical analysis and has taught his unique brand of price-action trend following to thousands of Aussie investors.

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