Data Insights

The 10 most overbought and oversold ASX 200 stocks – Week 43

Mon 23 Oct 23, 11:56am (AEDT)
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Key Points

  • Gold prices have surged due to escalating conflict in the Middle East
  • Ramelius Resources is the most overbought stock with an RSI of 73
  • Liontown Resources is the most oversold stock with an RSI of 10

Gold has rallied to a near three-month high as the escalating conflict in the Middle East is sending investors flocking towards the safe-haven metal. The V-shaped rally for gold has brought names like Ramelius Resources (ASX: RMS), Gold Road (ASX: GOR) and Northern Star (ASX: NST) into the most Overbought stocks list for this week.

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, Ramelius Resources is the most overbought stock with an RSI of 73.


The Most Overbought Stocks

Ticker

Name

RSI

1-Month %

Close Price

Target price

Upside

RMS

Ramelius Resources

73

17.7%

$1.73

$1.71

-1.2%

NWS

News Corp

71

12.1%

$35.48

na

na

CMM

Capricorn Metals

69

11.3%

$4.81

$4.83

0.4%

GOR

Gold Road Resources

69

11.0%

$1.86

$1.94

4.3%

WHC

Whitehaven Coal

67

12.5%

$7.54

$7.96

5.6%

NST

Northern Star Resources

67

12.0%

$12.13

$13.23

9.1%

ORG

Origin Energy

67

5.6%

$9.19

$8.45

-8.1%

BGA

Bega Cheese

63

7.0%

$2.92

$3.22

10.3%

SLR

Silver Lake Resources

63

11.7%

$1.01

$1.58

57.2%

STO

Santos

62

5.4%

$8.00

$9.08

13.5%

'Target price' is an aggregate of broker target prices from Refinitiv. Data of Friday, 20 October 2023 close.

Gold has climbed more more than 8% from its October 5 low to a brief high of US$1,997 an ounce. This resurgence is further fueled by a weakening US dollar and Fed Chair Powell's relatively dovish remarks last week.

gold
Gold daily chart (Source: TradingView)

The Most Oversold Stocks

Ticker

Name

RSI

1-Month %

Close Price

Target price

Upside

LTR

Liontown Resources

10

-36.7%

$1.90

$2.66

40.0%

CCP

Credit Corp

16

-38.0%

$12.40

$18.90

52.4%

AMP

AMP

18

-16.9%

$1.06

$1.15

8.5%

TLX

Telix Pharma

19

-25.4%

$8.40

$12.63

50.4%

BAP

Bapcor

21

-20.5%

$5.52

$6.83

23.7%

MFG

Magellan Financial

23

-30.8%

$6.44

$8.16

26.7%

CHN

Chalice Mining

24

-27.0%

$1.86

$2.74

47.7%

AWC

Alumina

24

-19.8%

$0.81

$1.10

35.8%

IFL

Insignia Financial

25

-14.6%

$2.04

$2.82

38.2%

TAH

Tabcorp

26

-11.3%

$0.86

$1.10

27.9%

'Target price' is an aggregate of broker target prices from Refinitiv. Data of Friday, 20 October 2023 close.

Most of these stocks have sold off due to downbeat trading updates.

  • Credit Corp (Oct 18): FY24 impairment. Downgraded FY24 statutory net profit by ~56%

  • AMP (Oct 18): FY24 guidance downgraded NIM outlook to below previous guidance

  • Bapcor (Oct 17): Shorter-term macroeconomic headwinds have led to more moderate growth for trade and wholesale markets as well as further deterioration in retail. Year-to-date net profit at the end of September was "behind expectations we had at the beginning of the year."

  • Tabcorp (Oct 12): Q1 trading update notes revenue down 6.1% year-on-year amid moderating wagering and gaming turnover

  • Magellan (Oct 6): Funds under management of $35.0 billion as at 29 September vs. $39.0 billion in the previous month

Even though they've fallen into oversold territory, most of these stocks have struggled to recover. Here's how they've performed since the above dates:

  • Credit Corp is trading around the same levels after the 30.5% selloff

  • AMP shares are down around 7.3% since the downgrade

  • Bapcor is down another 8.9% after falling 11.5% after the trading update

  • Tabcorp is down another 7.1% after a 6.2% selloff following the trading update

  • Magellan plunged 18.5% after the funds update and its down another 9.6% since

The persistent decline in these stocks despite their oversold status indicates that investors are hesitant to engage in dip-buying amidst broader market uncertainties.

Written By

Kerry Sun

Content Strategist

Kerry holds a Bachelor of Commerce from Monash University. He is an avid swing trader, focused on technical set ups and breakouts. Outside of writing and trading, Kerry is a big UFC fan, loves poker and training Muay Thai. Connect via LinkedIn or email.

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