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Data Insights
The 10 most overbought and oversold ASX 200 stocks – Week 38
By
Kerry Sun
Mon 18 Sep 23, 3:39pm (AEST)
Source: Shutterstock
Stocks in article
Key Points
- Washington H Soul Pattinson is the most overbought stock on the ASX 200, with an RSI of 82.
- Reporting season winners continue to dominate the overbought list, including Hub24, Johns Lyng, Seven Group, Bapcor, Carsales and AMP
- A few stocks from the Energy sector are also entering overbought territory, including New Hope (coal) and Paladin Energy (uranium)
Washington H. Soul Pattinson (ASX: SOL) was one of many stocks that saw abnormal share price gains at the close last Friday as fund managers scrambled to rebalance their portfolios ahead of the September 18 deadline. Shares in the diversified conglomerate rallied 6.6% last Friday, making it the most overbought stock on the ASX 200.
The 14-day Relative Strength Index is a momentum indicator that measures the magnitude and speed of recent price changes to assess whether or not a stock is overbought or oversold.
An RSI of 70 or above is considered to be overbought, which means the stock is rising too quickly and likely to experience a pullback. Meanwhile, an RSI of 30 or below is considered to be oversold, which means the stock is falling too quickly and is likely to experience a rebound.
Based on this indicator, WHSP is the most overbought stock with an RSI of 82.
The Most Overbought Stocks
Ticker | Name | RSI | 1-Month % | Close Price | Target price | Upside |
|---|---|---|---|---|---|---|
Washington H Soul Pattinson | 82 | 11.6% | $35.82 | $30.65 | -14.4% | |
Hub24 | 77 | 24.2% | $34.20 | $33.68 | -1.5% | |
Johns Lyng Group | 76 | 16.7% | $6.57 | $7.36 | 12.0% | |
Seven Group | 73 | 7.6% | $29.05 | $30.24 | 4.1% | |
Homeco Daily Needs | 72 | 10.3% | $1.29 | $1.37 | 6.6% | |
Bapcor | 71 | 7.3% | $7.07 | $7.50 | 6.1% | |
Carsales | 71 | 6.5% | $29.66 | $28.07 | -5.4% | |
New Hope Corp | 70 | 7.6% | $6.22 | $6.20 | -0.3% | |
AMP | 70 | 4.8% | $1.31 | $1.20 | -8.0% | |
Paladin Energy | 69 | 29.5% | $0.97 | $1.05 | 8.8% |
'Target price' is an aggregate of all broker target prices under Refinitiv's database. Data as at Friday, 16 September 2023 close. (Table: Market Index | Source: Refinitiv)
Washington H Soul Pattinson aside, the Overbought list continues to be dominated by one major theme: Reporting season winners.
Names including Hub24, Johns Lyng, Seven Group, Bapcor, Carsales and AMP have all continued to grind higher after reporting results back in August.
Hub24 3-month price chart (Source: Market Index)
John Lyng 3-month price chart (Source: Market Index)
We're also beginning to see a few stocks from the Energy sector enter overbought territory, that being New Hope (coal) and Paladin Energy (uranium). This follows a sharp rebound across most energy commodities including:
WTI crude: Up 16% since 23 August
Newcastle coal futures: Up 22.5% since late July
Met coal: Up more than 20% in the past month
Uranium: Up almost 30% since mid August
As for oversold stocks, the list continues to serve as a reminder to stay away from stocks that have been sent to the doghouse. Regardless of how they were sold off, they tend to stay oversold for quite some time.
From the list below,. this includes reporting season losers like Resmed and Fletcher Building, beleaguered Qantas or the Orora, which recently raised $1.35bn at a 21.3% discount to acquire French glass bottles manufacturer Saverglass.
The Most Oversold Stocks
Ticker | Name | RSI | 1-Month % | Close Price | Target price | Upside |
|---|---|---|---|---|---|---|
Resmed Inc | 21 | -14.6% | $22.98 | na | na | |
The Lottery Corp | 22 | -8.1% | $4.76 | $5.42 | 13.9% | |
Chalice Mining | 24 | -41.4% | $2.95 | $4.41 | 49.5% | |
Kelsian Group | 27 | -11.1% | $6.00 | $7.43 | 23.8% | |
Orora | 27 | -19.1% | $2.79 | $3.34 | 19.7% | |
Cromwell Property Group | 28 | -15.7% | $0.43 | $0.74 | 72.1% | |
Cleanaway Waste Management | 28 | -7.9% | $2.45 | $2.76 | 12.7% | |
The Star Entertainment | 29 | -17.8% | $0.86 | $1.20 | 40.4% | |
Qantas Airways | 30 | -10.0% | $5.61 | $8.27 | 47.4% | |
Fletcher Building | 30 | -7.7% | $4.19 | $5.24 | 25.1% |
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