Evening Wrap: ASX 200 logs ninth consecutive win to close out solid week of gains, as gold and iron ore stocks rally

It was a solid-ish end to a solid-ish week. Why "ish"?

Well, we closed over half way down from today's session high, so that indicates at least some market participants were happy to let go some stock and free up cash heading into the weekend. Sell the rally is always a little off-putting after a strong rally like the one we've just had.

Secondly, whilst we did eke out a respectable 1.3% gain over the last 5 days, we fell substantially short of the gains experienced on US stock indices (+6.6% and counting on the Nasdaq Composite). Hey, we're no Nasdaq – but it still would have been nice to experience a little more of the unbridled enthusiasm shown State-side.

Gold bugs won't care much about any of the "ish" stuff today, they're just relieved their favourite ASX gold stocks rebounded after what has been a very tough week-and-a-bit. After taking out the dubious honour of the worst ASX sector in 4 out of the 6 prior trading sessions – the Gold (XGD) sub-index (+3.1%) topped today's sector performance table.

Iron ore stocks also performed strongly today, with BHP Group (+1.1%) and Fortescue (FMG) (+1.3%) helping the sector cap a strong week of gains.

Only really Information Technology (XIJ) (-0.93%) could be said to have done it tough, and that's probably only just a bit of profit taking after a very strong week (it still logged a +5.6% weekly gain).

Uranium stocks were a curious bunch, though, with each of the majors logging ~5%-or-greater declines today. No news across any of them, and actually some very good news for uranium bulls via the uranium price today – more on that in ChartWatch.

To make sense of all the above, I have detailed technical analysis on the Nasdaq Composite, S&P/ASX 200, and Uranium in today's ChartWatch.

Be sure to click/scroll through for the usual reporting of the major sector and stock-specific moves, the broker responses to them, as well as all the key upcoming economic data in tonight's Evening Wrap.

Let's dive in!

Markets

ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 46.2 points higher at 8,343.7, roughly mid-range, 0.56% from its session low and 0.65% from its high. In the broader-based S&P/ASX 300 (XKO) advancers beat decliners by a modest 164 to 128. For the week, the XJO finished up 112.5 points or 1.37% higher, 1.37% from its intraweek low and 0.65% from its intraweek high.

ChartWatch

NASDAQ Composite Index

There is a smidge of excess supply lurking around here 🤏 (click here for full size image)

Note that I’ve highlighted a 18831-19415 sub-zone of the 18831-20205 major supply zone which I think is impacting the price action right now. That 18831-20205 zone of course, being a 2-month consolidation area below the all-time high (16-Dec – 27-Feb).

The theory behind a historic demand zone behaving as a future supply zone works like this (it’s actually quite simple):

1. When the original zone of consolidation was formed, there were plenty of investors entering the market in that price range. We know this, because of all the demand-side candles formed there, as well as due to all the above-average volume days during that period. The greater the indication that plenty of investors entered in a historic demand zone, the greater the likelihood it will behave as a significant future supply zone. Why? Because it means that for plenty of investors, this is their base entry price.

2. When the market broke below the bottom of the range, and in this case into a bona-fide bear market, it means that plenty of investors were pushed into a losing position. Many of them regret buying (at the top) but refuse to sell at a loss. However, if they could somehow breakeven – well that’s a different matter! (We’ve all been there…”Please God, if you just let the market go back up so I can break even, I promise I will get out and never trade again 🙏!”)

3. This creates at least some latent supply at this group of investors’ breakeven price, i.e., within the range of the consolidation zone. Not all investors who bought in the consolidation zone will think like this, but some will. Depending on how many do, i.e., how many will be triggered to sell by the prospect of finally breaking even – it will shape the candles that manifest in the zone should the price ever return there.

And that’s where our usual analysis picks up. We are aware that certain areas of price might be associated with elevated demand or supply (supply in this case), and we must therefore watch the candles extra closely in those areas.

So, making this long story short, I’m looking at that 18831-19415 area initially as a range where we could see some excess supply manifest itself. More broadly, however, the zone is 18831-20205.

This doesn’t mean the price is going to peak in 18831-19415 and crash. That’s a possibility, but I believe it’s far less likely than “a bit of supply causing a few equilibrium candles” or “a bit of supply causing a minor pullback”. Because this time we’re hitting the relevant supply zone with some proper demand-side force.

The lighter-pink zone is so far showing only very mild signals that supply is increasing to a point where it’s having a negative impact on the Comp’s price. Last night’s candle did have a very small upward pointing shadow – so, yes, there is a smidge of excess supply lurking around here.

The important bit so far, is that the demand-side appears capable of dealing with it.

If the candles grow more supply-side oriented in nature around here, then I see demand likely kicking back in around the short and long term trend ribbons combination. A test and hold there confirms a new bull market has begun – but really any trough at or above that zone will do so.

Watch also the low of the 12-May gap up candle. You can only get a candle like that if there’s a bucket load of excess demand in the system. That demand saw great value in that price range last time, entering in force, perhaps they do so again next time.

If that demand is consumed, and we close below the gap, then we have a problem – but that’s a good thing in terms of helping us understand what’s going on.

In conclusion, I still can’t see anything in the candles to push me off my current view that the demand-side is in control of both short term and long term Comp price action. Therefore, I remain comfortable maintaining exposure to the prevailing trends.

S&P/ASX 200 (XJO)

We shouldn't expect anything else from the XJO on a Friday! 🤦 (click here for full size image)

I see a similar situation here with the XJO. So, consider the previous consolidation zone is 8353-8616. Far less brief, though, and therefore perhaps less influential.

I’d also break it into a bottom half and top half, with the bottom half falling between 8353-8445 – an area I’ve been proposing will be a potential supply zone for over a week now.

Ordinarily, I’d say today’s long upward pointing shadow is clear evidence of the latent supply lurking in that zone. However, knowing the XJO all too well – I might also simply put it down to our usual failure to commit. It’s also Friday.

For those who are new to ChartWatch, and perhaps don’t yet understand the importance of a long upward pointing shadow – consider this:

• At one point, that shadow didn’t exist – when the price was equal the to the high of the session it was a full white-bodied candle, therefore indicating excess demand (the longer the candle, the greater the excess demand).

• The only way the shadow can exist is if the price then fell back from the session’s high (and as it does, it creates the upward pointing shadow).

The longer the upward pointing shadow – the more potentially bearish the signal. Long upward pointing shadows can only occur if:

1. The demand-side become exhausted, and the supply-side was motivated enough to offer at lower and lower prices to get their work done. Or,

2. The demand-side didn’t exhaust…it actually kept hoovering up stock all day, but there was just so much supply – and motivated supply – that prices were beaten down anyway.

You’ll be able to tell the difference between each scenario by looking at volume. 1 would be associated with lesser volume and 2 with a whole lot of it. Logically, 2 is a far scarier prospect than 1 if you’re a bull and far more tantalising if you’re a bear.

Neither is a glowing endorsement of demand-side control / motivation – and both smack of a sell the rally mentality that has dogged the XJO this week.

A healthy demand-side market knows only buy the dip. So, today’s candle is hardly a glowing endorsement for demand-side control.

Looking at the volume, though, we can conclude today was a Scenario 1. It is Friday, no surprise there.

Putting all the pieces together, I not reading too much into today’s far from ideal price action. It was still a good week. We’re still showing strong trends, price action, and yes – even candles.

There’s plenty of demand all the way back down into the two trend ribbons, as well as at least a couple of static points of demand lurking in the mix as well.

I’d need to see something far more credible in the 8353-8445 supply zone to be really concerned – and I suspect we’ll all be watching the candles very closely from here.

Uranium Futures (Front month, back-adjusted) COMEX

Long term downtrend is now on pause ⏸️ (click here for full size image)

A quick update here, deserves one given Thursday’s close transitioned the long term trend ribbon to neutral – the first time it’s been that way since 16-Dec 2024 (nearly 6 months to the day!).

It doesn’t mean the uranium bear market, the start of which was called right here on 23-Jul 2024, is over.

I still believe that a close below 83.15 seals the deal on the transition of uranium’s long term trend from uptrend to downtrend

– ChartWatch, Tues 23 July 2024.

Ideally, I want to see the price close above that long term trend ribbon and then log the all-important trough above it to indicate that the long term trend ribbon has transitioned to behaving as a zone of excess demand.

I.e., the opposite of the method I used to nail that call uranium’s long term uptrend had transitioned to a long term downtrend / bear market back in July last year.

Good analysis – whether it be technical, fundamental, or astrological (don’t laugh, some swear by it!), is all about consistency. Identify what works more often than not (remember the power of “MOTN”). Identify what doesn’t work more often than not. Only do the former and never do the latter.

Uranium’s trends and price action are on the mend, but it’s not out of the woods yet. There’s still every chance the long term trend ribbon does what it’s good at – killing fledgling short term uptrends and restarting bear markets ⚠️!

We have a start, but more work must be done in the uranium price action, and by us in analysing it. You know what I still need to see to call this a new long term uptrend / bull market. Let’s see how it plays out from here.

Economy

Today

• There weren't any major data releases in our time zone today

Later this week

Saturday

• 00:00 USA Prelim UoM Consumer Sentiment May (53.1 forecast vs 52.2 in April)

Latest News

Interesting Movers

Trading higher

• +21.9% Dateline Resources (DTR) – No news since 13-May Sale of Non-Core Asset, rise is consistent with prevailing short term uptrend and long term trend is transitioning from down to up 🔎📈

• +18.3% Appen (APX) – AGM - Chairman's Address & FY25 Guidance.

• +14.8% Titomic (TTT) – No news, general strength across the broader Gold sector today, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +11.4% Brightstar Resources (BTR) – No news since 15-May May Production Update - Processing Underway, general strength across the broader Gold sector today, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +10.2% Chalice Mining (CHN) – No news 🤔.

• +9.0% Core Lithium (CXO) – Continued positive response to 14-May Restart Study Repositions Finniss Operations.

• +8.6% Aurelia Metals (AMI) – No news, general strength across the broader Copper-Gold sector today, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.8% Novonix (NVX) – No news 🤔.

• +7.3% Aspen Group (APZ) – Successful Completion of Equity Raising, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +6.4% Pantoro (PNR) – No news, general strength across the broader Gold sector today, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +6.3% Liontown Resources (LTR) – Appendix 3Y - Tim Goyder (not the reason for the gain today, although this should raise a few eyebrows given time vis-a-vis recent run up!), rise is consistent with prevailing short term uptrend and long term trend is transitioning from down to up 🔎📈

• +5.9% Resolute Mining (RSG) – Becoming a substantial holder (Goldman Sachs), rise is consistent with prevailing short term uptrend and long term trend is transitioning from down to up, a recent regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +5.7% Regal Partners (RPL) – No news 🤔.

• +5.0% Mayne Pharma Group (MYX) – ASIC registration of Mayne Pharma scheme booklet.

• +4.9% Catalyst Metals (CYL) – Trident development approved to proceed, general strength across the broader Gold sector today, rise is consistent with prevailing short and long term uptrends, one of the most Featured (highest conviction) stocks in ChartWatch ASX Scans Uptrends list 🔎📈

• +4.9% Antipa Minerals (AZY) – No news, general strength across the broader Gold sector today.

• +4.6% Genesis Minerals (GMD) – No news, general strength across the broader Gold sector today.

• +4.5% St Barbara (SBM) – No news, general strength across the broader Gold sector today.

• +4.5% Ora Banda Mining (OBM) – No news, general strength across the broader Gold sector today.

• +4.2% Bellevue Gold (BGL) – No news, general strength across the broader Gold sector today.

• +4.2% Vaneck Gold Miners ETF (GDX) – No news, general strength across the broader Gold sector today (this is a gold miners ETF).

• +4.2% Perseus Mining (PRU) – No news, general strength across the broader Gold sector today.

Trading lower

• -22.2% Dusk Group (DSK) – FY25 Trading Update.

• -7.6% Paladin Energy (PDN) – No news, general weakness across the broader Uranium sector today, fall is consistent with prevailing long term downtrend 🔎📉

• -6.9% Boss Energy (BOE) – No news, general weakness across the broader Uranium sector today.

• -4.9% Deep Yellow (DYL) – No news, general weakness across the broader Uranium sector today.

• -4.8% Bannerman Energy (BMN) – No news, general weakness across the broader Uranium sector today.

• -4.7% Avita Medical (AVH) – No news, fall is consistent with prevailing short and long term downtrends, a regular in ChartWatch ASX Scans Downtrends list 🔎📉

• -3.7% Syrah Resources (SYR) – No news since 15-May Balama production targeted by end of June 2025 quarter, pulled back in the wake of recent sharp rally.

• -3.3% Mesoblast (MSB) – No news since 15-May FDA Provides Ryoncil 7 Years Orphan-Drug Exclusive Approval, fall is consistent with prevailing short term downtrend and long term trend is transitioning from up to down 🔎📉

Broker Moves

Alcoa Corporation (AAI)

• Downgraded to neutral from buy at UBS; Price Target: US$31.00

Auckland International Airport (AIA)

• Retained at buy at Citi; Price Target: NZ$9.20 from NZ$9.80

Aristocrat Leisure (ALL)

• Retained at buy at Bell Potter; Price Target: $79.00 from $83.00

ANZ Group (ANZ)

• Retained at neutral at Macquarie; Price Target: $27.50

Australian Unity Office Fund (AOF)

• Retained at hold at Ord Minnett; Price Target: $0.490 from $1.110

Alliance Aviation Services (AQZ)

• Retained at add at Morgans; Price Target: $3.90 from $4.10

Accent Group (AX1)

• Retained at buy at Citi; Price Target: $2.61

Breville Group (BRG)

• Retained at accumulate at Ord Minnett; Price Target: $35.00 from $40.00

Commonwealth Bank of Australia (CBA)

• Retained at underperform at Macquarie; Price Target: $105.00

Chalice Mining (CHN)

• Retained at speculative buy at Morgans; Price Target: $2.90 from $2.80

Charter Hall Retail Reit (CQR)

• Retained at buy at Citi; Price Target: $4.00

Cedar Woods Properties (CWP)

• Retained at buy at Shaw and Partners; Price Target: $7.15 from $7.00

Elanor Commercial Property Fund (ECF)

• Retained at hold at Ord Minnett; Price Target: $0.620 from $0.640

Firefly Metals (FFM)

• Retained at buy at Shaw and Partners; Price Target: $1.900

Graincorp (GNC)

• Retained at hold at Bell Potter; Price Target: $7.45

• Retained at buy at Jefferies; Price Target: $9.20 from $9.00

• Retained at outperform at Macquarie; Price Target: $8.95 from $8.76

• Retained at hold at Morgans; Price Target: $8.20 from $8.04

• Retained at buy at Ord Minnett; Price Target: $9.75 from $9.50

• Retained at outperform at RBC Capital Markets; Price Target: $9.75

• Retained at buy at UBS; Price Target: $8.60 from $8.50

• Retained at overweight at Wilsons; Price Target: $8.71 from $8.97

Humm Group (HUM)

• Retained at buy at Shaw and Partners; Price Target: $0.900 from $1.000

Insurance Australia Group (IAG)

• Retained at buy at Citi; Price Target: $10.00 from $9.05

• Retained at neutral at Goldman Sachs; Price Target: $8.30

• Downgraded to neutral from overweight at Jarden; Price Target: $8.00 from $7.70

• Retained at overweight at JP Morgan; Price Target: $8.90 from $8.00

• Retained at equal-weight at Morgan Stanley; Price Target: $7.95 from $7.85

• Downgraded to neutral from buy at UBS; Price Target: $9.30 from $8.30

Lendlease Group (LLC)

• Retained at neutral at Citi; Price Target: $7.50

Lovisa (LOV)

• Retained at sell at Citi; Price Target: $25.86

National Australia Bank (NAB)

• Retained at neutral at Macquarie; Price Target: $35.00

Navigator Global Investments (NGI)

• Retained at outperform at Macquarie; Price Target: $2.39 from $2.37

Nickel Industries (NIC)

• Retained at buy at Citi; Price Target: $0.900

Northern Star Resources (NST)

• Retained at buy at Citi; Price Target: $22.50

NRW (NWH)

• Retained at buy at Argonaut Securities; Price Target: $3.70

• Retained at buy at Citi; Price Target: $3.65 from $3.85

• Retained at outperform at CLSA; Price Target: $3.60

• Retained at buy at Euroz Hartleys; Price Target: $4.23

• Retained at neutral at Macquarie; Price Target: $3.00

Orora (ORA)

• Retained at neutral at Citi; Price Target: $2.10 from $2.40

• Retained at neutral at Goldman Sachs; Price Target: $2.40

• Retained at outperform at Macquarie; Price Target: $2.39 from $2.42

• Retained at overweight at Morgan Stanley; Price Target: $2.50

• Retained at hold at Ord Minnett; Price Target: $2.30 from $2.40

Ramsay Health Care (RHC)

• Retained at equal-weight at Morgan Stanley; Price Target: $37.20

Super Retail Group (SUL)

• Retained at buy at Citi; Price Target: $16.50 from $17.00

Treasury Wine Estates (TWE)

• Retained at neutral at Citi; Price Target: $10.50

• Downgraded to neutral from outperform at Macquarie; Price Target: $8.90 from $11.70

• Initiated at outperform at RBC Capital Markets; Price Target: $11.00

WA1 Resources (WA1)

• Retained at speculative buy at Canaccord Genuity; Price Target: $28.00

Westpac Banking Corporation (WBC)

• Retained at underperform at Macquarie; Price Target: $27.50

Xero (XRO)

• Retained at buy at Citi; Price Target: $200.00

• Retained at buy at Goldman Sachs; Price Target: $205.00 from $201.00

• Retained at overweight at Jarden; Price Target: $190.00 from $180.00

• Downgraded to hold from buy at Jefferies; Price Target: $194.80 from $185.00

• Retained at outperform at Macquarie; Price Target: $204.00 from $191.90

• Retained at overweight at Morgan Stanley; Price Target: $220.00

• Upgraded to add from hold at Morgans; Price Target: $215.00 from $188.00

• Retained at buy at UBS; Price Target: $215.00 from $196.00

• Upgraded to overweight from market-weight at Wilsons; Price Target: $213.56 from $179.92

Scans