Shares RSIs, highs and lows

A regular look at shares trading close to significant levels.

Power firm Aggreko remains overbought after a strong performance by the shares in recent sessions, while InterContinental Hotels is back on the list after reports it rejected a £6 billion bid from a rival. No detail has been provided on the identity of the suitor, but some have suggested an American firm may be in the frame as it seeks to achieve tax re-domiciling, an aim of Pfizer’s in its (currently) thwarted bid to acquire AstraZeneca.

 

Relative Strength Index (RSI)*

Company

Share Price

Oversold

Company

Share Price

Overbought

Lancashire Holdings 614 21.48 Heritage Oil 315.2

73.28

Carpetright 525 23.56 Vedanta Resources 1076 73.12
Petropavlovsk 61.75 27.12 InterContinental Hotels Group 2320 72.96
Renishaw 1665 27.17 National Grid

889.5

70.92
QinetiQ Group 195.1 27.79 3i Infrastructure 138.7 70.65
Drax Group

614

28.61 Aggreko 1739 69.84
SuperGroup 1084 29.94 Pennon Group 771.5 69.64

 

Retailer Halfords has pedaled its way near to recent highs, as it looks to break towards £5. So far it has not been able to achieve this, but the impressive rally over the past month has given it the upward momentum needed. A similar story prevails for can maker Rexam, where 530p has marked the upside limit in the share price. Rangebound trading in the share price has meant that a failure to break through 530p means we could be in for another slump towards 470p.

Highs/Lows**

Company

Share Price

% off 52-week high

Company

Share Price

% off 52-week low

National Grid 889.5 -0.50% Experian 1023 0.49%
Reed Elsevier 936 -0.64% Dairy Crest Group 433.9 2.65%
Heritage Oil 315.2 -0.85% Intertek Group 2902 4.09%
Rexam 531 -1.03% Dignity

1361

4.13%
Bunzl

1674

-1.06% International Public Partnerships 130.1 5.34%
Smith & Nephew 953.5 -1.09% Carpetright 525 6.49%
BP 505.3 -1.13% Rolls-Royce Holdings 1002 6.60%
United Utilities Group 851.5 -1.22% Meggitt 474.8 6.70%
Halfords Group 492.9 -1.22% UBM 661 6.79%
Reckitt Benckiser Group 5040 -1.56% GlaxoSmithKline 1632 6.81%

 

*What is a relative strength index?

Relative strength index is a technical momentum indicator that compares the magnitude of recent gains to recent losses in an attempt to determine overbought and oversold conditions of an asset.

An asset is viewed as overbought once the RSI approaches the 70 level, meaning that it may be getting overvalued and is a candidate for a possible pullback. Conversely, if the RSI approaches 30, it is an indication that the asset may be oversold and may become undervalued.

**What is the significance of 52-week highs and lows?

One popular strategy is to buy when shares exceed 52-week highs and sell when they fall below 52-week lows.

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