Trading Ideas

Top5 oversold/overbought according to RSI & NEPI Rockcastle



Top5 oversold/overbought according to RSI & NEPI Rockcastle by SchalkLouw on TradingView.com

Welcome back MediClinic! After some pressure years, you’re back into “overbought” after a solid trading update this week.

Top 5 Oversold & Overbought currently according to their 14-day RSI’s:

Oversold:

Hospitality Property B 27
Fortress REIT B 30
Cashbuild 31
Libstar Hlds 34
NEPI Rockcastle 35

Overbought:

Northam Platinum 83
MediClinic Intl 74
Capital & Counties Properties 73
Hammerson 73
Stor-Age Property REIT

This week I want to spend some time on NEPI Rockcastle. After a strong start of the first 9 months of 2019, NEPI took a bit of a breather in October. Note that NEPI has gone ex-dividend (R4.82) on the 9th of October, so some of the price movement was dividend related. Speaking of which – at a historic dividend yield of 7.2%, it’s definitely looking attractive from a passively paying income investment.

Technically, NEPI is looking attractive. The share price is still trading above both an up-trending 200-day Moving Average and its longer-term diagonal support line. The RSI (currently 34.91) is not trading at EXTREME oversold levels yet and for those prepared to take the chance, could maybe wait for R126.50 (bottom of diagonal support). A break below this level could see support at the 200-day Moving Average at R125.42. If I was a short-term trader, this will be my stop loss as next support then only arrive at R116.

Should we see a recovery from current levels, could see the 50-day Moving Average at R132 as next resistance level with a break and close above those levels, only looking for next resistance at R138 (top diagonal resistance line). A break and close above this level will be very bullish and bring into play the current Thomson Reuters consensus target price of R141.26.

 

Schalk Louw
As Portfolio Manager at PSG Wealth Old Oak and with over 20 years’ experience in the investment industry, Schalk has consistently delivered solid returns to his clients and has certainly become one of South Africa’s most well-known strategists. He started his career in 1994 at the stockbroking company, Huysamer Stals (later ABN Amro). He joined SMK Securities in 1997, (later became BoE Personal Stockbrokers) and was later appointed as director and branch manager. In 2001 he co-founded Contego Asset Management and managed the company as CEO up to March 2014, after which he joined PSG Wealth Old Oak. Schalk has also become a regular household name with investors, with his reports being published in many of the national press. He completed his MBA in 2008.

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