The 10 most overbought and oversold ASX 200 stocks – Week 43
The V-shaped rally for gold has brought names several gold miners into this week's Overbought list.
Source: Shutterstock
Mentioned
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 |
|---|---|---|---|---|---|---|
Ramelius Resources | 73 | 17.7% | $1.73 | $1.71 | -1.2% | |
News Corp | 71 | 12.1% | $35.48 | na | na | |
Capricorn Metals | 69 | 11.3% | $4.81 | $4.83 | 0.4% | |
Gold Road Resources | 69 | 11.0% | $1.86 | $1.94 | 4.3% | |
Whitehaven Coal | 67 | 12.5% | $7.54 | $7.96 | 5.6% | |
Northern Star Resources | 67 | 12.0% | $12.13 | $13.23 | 9.1% | |
Origin Energy | 67 | 5.6% | $9.19 | $8.45 | -8.1% | |
Bega Cheese | 63 | 7.0% | $2.92 | $3.22 | 10.3% | |
Silver Lake Resources | 63 | 11.7% | $1.01 | $1.58 | 57.2% | |
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 daily chart (Source: TradingView)
The Most Oversold Stocks
Ticker | Name | RSI | 1-Month % | Close Price | Target price | Upside |
|---|---|---|---|---|---|---|
Liontown Resources | 10 | -36.7% | $1.90 | $2.66 | 40.0% | |
Credit Corp | 16 | -38.0% | $12.40 | $18.90 | 52.4% | |
AMP | 18 | -16.9% | $1.06 | $1.15 | 8.5% | |
Telix Pharma | 19 | -25.4% | $8.40 | $12.63 | 50.4% | |
Bapcor | 21 | -20.5% | $5.52 | $6.83 | 23.7% | |
Magellan Financial | 23 | -30.8% | $6.44 | $8.16 | 26.7% | |
Chalice Mining | 24 | -27.0% | $1.86 | $2.74 | 47.7% | |
Alumina | 24 | -19.8% | $0.81 | $1.10 | 35.8% | |
Insignia Financial | 25 | -14.6% | $2.04 | $2.82 | 38.2% | |
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.
