The 10 most overbought and oversold stocks on the ASX 200 – Week 31
AGL Energy is the most overbought stock on the ASX 200 this week, with an RSI of 85.
Source: iStock
Mentioned
KEY POINTS
- AGL Energy is the most overbought stock on the ASX 200, with an RSI of 85
- Other overbought stocks include Flight Centre, Beach Energy, James Hardie, and Megaport
- The most oversold stocks are Core Lithium as well as five other battery metal laggards
Shares in AGL Energy (ASX: AGL) are up 82% from its low point in mid-March, which makes 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, AGL is the most overbought stock with an RSI of 85.
Most Overbought Stocks
Ticker | Name | Sector | RSI | Target price | Return |
|---|---|---|---|---|---|
AGL Energy | Utilities | 85 | $11.21 | -8.6% | |
Flight Centre | Discretionary | 78 | $22.41 | -3.4% | |
Beach Energy | Energy | 78 | $1.78 | 10.2% | |
James Hardie | Materials | 77 | $40.18 | -7.1% | |
Orora | Materials | 76 | $3.59 | 1.1% | |
Megaport | Technology | 74 | $9.58 | -9.6% | |
Challenger | Financials | 73 | $7.20 | 0.3% | |
Corporate Travel Management | Discretionary | 73 | $22.10 | 5.6% | |
Woodside Energy | Energy | 72 | $36.69 | -3.5% | |
ANZ Group | Financials | 72 | $25.06 | -2.7% |
'Target price' is an aggregate of all broker target prices under Refinitiv's database. Data as at Friday 28, July 2023 close. (Table: Market Index | Source: Refinitiv)
Last week, Credit Corp was the most overbought ASX 200 stock with an RSI of 85. The company experienced an almost 7% pullback between 24-26 July, which was followed by a V-shaped rally back to recent highs. Despite the recent strength, the pullback helped reset the RSI to 71.
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Credit Corp 3-month price chart (Source: Market Index)
AGL Energyshares have been on an extraordinary run thanks to an improved outlook for electricity markets. Last month, the company guided to FY24 net profit between $580-780 million, more than double what it’s expecting in FY23 ($255-285 million). The stock has taken very few breathers in its run to fresh two-and-a-half year highs. This begs the question – When will we see a pullback?
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AGL 12-month price chart (Source: Market Index)
Megaport launched into overbought territory after two massive gap ups:
11 July (+34.0%) after EBITDA guidance update for FY23 and FY24
27 July (+14.4%) after quarterly cash flow report
The stock is down around 1.8% on Monday afternoon.
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Megaport 3-month price chart (Source: Market Index)
And here’s a list of the most oversold ASX 200 stocks.
Most Oversold Stocks
Ticker | Name | Sector | RSI | Target price | Return |
|---|---|---|---|---|---|
Core Lithium | Materials | 19 | $0.74 | 12.1% | |
Lake Resources | Materials | 22 | ~ | ~ | |
Regis Resources | Materials | 28 | $2.33 | 36.3% | |
Link Administration | Industrials | 28 | $2.30 | 52.3% | |
Perpetual | Financials | 33 | $31.58 | 31.3% | |
Sayona Mining | Materials | 33 | $0.27 | 80.0% | |
Iluka Resources | Materials | 34 | $11.26 | 9.1% | |
Lynas Rare Earths | Materials | 34 | $9.21 | 40.4% | |
Syrah Resources | Materials | 34 | $1.15 | 62.0% | |
Tabcorp | Discretionary | 35 | $1.20 | 13.2% |
'Target price' is an aggregate of all broker target prices under Refinitiv's database. Data as at Friday 28, July 2023 close. (Table: Market Index | Source: Refinitiv)
There are six battery metal stocks on the oversold list – Which are down an average 16.2% in the past month.
Core Lithium shares nosedived 17% last Monday after its FY24-25 production and cost guidance came in well below company guidance and consensus. The lithium and battery metals sector is entering a phase where the tide does not lift all boats – And in the case of these oversold stocks, there’s a reason why they’re lagging behind and struggling to bounce from recent lows.
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Core Lithium 12-month price chart (Source: Market Index)
