DevEx Resources Limited (ASX: DEV)

Incorporated in 1969, DEV is a diversified mineral exploration company, having porphyry copper-gold as a main focus. It owns Sovereign project, Junee project, Basin Creek project, and West Arnhem Nabarlek project. Its market capitalization stood at AUD 107.74 million as of 10^th November 2021.

Financial & Operational Updates – On 10^th November 2021, the company has completed the first two diamond drilling at its Sovereign Nickel-Copper-PGE project in WA with outcome of thick intrusive sequence of metamorphosed gabbronorite found. As per the quarterly report released on 28^th October 2021, several induced polarisation (IP) anomalies were found beneath copper-gold bedrock strongly supporting the potential porphyry copper-gold at the Junee Project, NSW. After considering nil cash receipts from customers in 1QFY22, cash balance at the end of 30^th September 2021 was reported at ~AUD 13.97 million versus ~AUD 16.57 million at the end of 30^th June 2021. As per the Annual Report released on 27^th September 2021, the other income increased from ~AUD 0.107 million in FY20 to ~AUD 0.299 million in FY21. It had recorded net loss after tax of ~AUD 6.58 million for FY21 as against ~AUD 3.47 million in FY20. 

Technical Analysis: On a weekly chart, DEV prices are sustaining above the trend-following indicators 50-period SMA and 21-period SMA, indicating a positive stance for the stock. The momentum oscillator RSI (14-period) is trading in the positive zone at ~59.121 levels and forming a moderate positive divergence with the prices action, supporting an uptrend. In the short term, the stock may witness an uptrend subject to a support level at AUD 0.290 while the key resistance is at AUD 0.4800 level.

Along with DEV’s recently found anomalies and drilling updates in the 1QFY22, its current price levels suggest the investors with a high-risk appetite a ‘Speculative Buy’ stance along with incorporating the support and resistance as one of the tools while analysing the investment opportunity. The stock was analysed as per the current price of AUD 0.3775 per share, 11:45 AM (GMT+10), Sydney, Eastern Australia, as of 10^th November 2021. However, the risk levels are extremely high in view of the prospective findings, its development and related saleability.

Weekly Technical Chart – DEV

Source: REFINITIV

Rhythm Biosciences Limited (ASX: RHY)

Found in 2017, RHY develops and commercialises the medical diagnostics technology in Australia and International market. Its market capitalization stood at AUD 402.98 million as of 10^th November 2021.

Financial and Operational Updates: As per the recent quarter report published on 29^th October 2021, Cash and cash equivalents status at the end of 30^th September 2021 was ~AUD 5.28 million versus as ~AUD 2.22 million at the end of 30^th June 2021. On 26^th October 2021, Loumea Investments Pty Ltd ceased to be the substantial shareholder. On 21^st October 2021, the commercially manufactured ColoSTAT® test-kits confirmed consistent, high accuracy results. On 5th October, RHY received a R&D tax refund of ~AUD 2.4 million as a part of the Australian Government R&D tax incentive scheme. As per the Annual Report, The Net Losses reported for the FY21 was ~AUD 6.61 million as compared to ~AUD 4.02 million in FY20, whereas the interest income reduced from ~AUD 46.26k in FY20 to ~AUD 13.97 million in FY21.

Technical Analysis: RHY stock prices are sustaining above the horizontal trend line support level at AUD 1.67 on the weekly chart. Moreover, the prices are trading above the trend-following indicators 21-period SMA and 50-period SMA, which may act as a support level. The momentum oscillator RSI (14-period) is trading in an overbought zone at ~76.98 level and formed negative divergence, which indicate the possibility of a downside correction from the higher levels. The important for the support levels stock is placed at AUD 1.670 while resistance level is at AUD 2.080.

It is prudent to suggest A ‘Watch’ stance, after considering its current RSI levels with negative divergence and nil receipts from customers during Q1FY22. The stock was analysed as per the closing price of AUD 1.930 per share, as of 10^th November 2021.

Weekly Technical Chart – RHY

Source: REFINITIV

Cfoam Limited (ASX: CFO)

Cfoam’s principal activity includes commercialisation of various carbon products like inorganic carbon material coming from coal, pitch or lignin feedstock. Its market capitalization stood at AUD 9.53 million as of 10^th November 2021.

Financial and Operational Updates: As per the Quarterly Update on 29^th October 2021, the company settled AUD 2.24 million placement tranche 2 in July 2021. Its sales receipts for 1QFY22 were ~USD 0.112 million and cash balance at the end of 30^th September 2021 was reported at ~USD 1.138 million versus ~USD 1.101 million at the end of 30^th June 2021. Its products were sold to 20 different organisations while maintaining the operational cost.  A DOE grant funds of USD 0.139 million were received in the quarter. As per the Annual Report released on 6^th September 2021, the revenue from operations dropped from ~USD 0.847 million in FY20 to ~USD 0.654 million in FY21. It had recorded net loss after tax of ~USD 3.037 million for FY21 as against ~USD 5.474 million in FY20. 

Technical Analysis: On the weekly chart, its price is trading in a flat range bounded movement since the start of the year 2021, consolidating between AUD 0.012 to AUD 0.042. Its CMP is trading below the trend-following indicators 21-period SMA and 50-period SMA, acting as resistance zone. However, the momentum oscillator RSI (14-period) is trading in a mid-range at (~40.789 level), that indicates the price is losing momentum and supporting a directionless movement for the short-term. An important support level for the stock is placed at AUD 0.012, while the key resistance is at AUD 0.0145.

A ‘Watch’ stance is suggested after considering the current sideways movement of the price levels and continued losses in FY21. The stock was analysed as per the closing price of AUD 0.0125 per share, down by ~3.847%, as of 10^th November 2021.

Weekly Technical Chart – CFO

Source: REFINITIV

Note 1: The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decisions should be made depending on the investors’ appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest. 

The Green colour line reflects the 21-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period, then it shows prices are currently trading in a bullish trend, (Vice – Versa).

The Blue colour line reflects the 50-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 50-period, then it shows prices are currently trading in a bullish trend, (Vice – Versa).

The Purple colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

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