ASX-All Ordinaries Index is Trading Above 50-Period SMA, One ASX-Listed Stock to Consider at the Current Levels -SOM

Company Overview:  SomnoMed Limited (ASX: SOM), together with its subsidiaries, designs, manufactures, and markets oral devices for the treatment of sleep-related disorders, including obstructive sleep apnea. The company has a global presence, operating across the Asia Pacific, North America, and Europe, and serves both clinical and homecare markets. Below are the key price indicators for the stock: This Report covers the Price Action, Technical Indicators Analysis along with the Stop Loss Levels, Target Prices, and Recommendation on this one stock. 

ASX All Ordinaries Index (.AORD) Market Round-Up

The ASX All-Ordinaries Index closed the week on a strong note at 8,579.90, marking a 1.39% gain. This solid performance was largely fueled by strength in U.S. equity markets, which created a favorable global backdrop and bolstered local investor sentiment, reinforcing the current bullish tone in Australian equities. 

The index continues to trade above a key falling trendline support, signalling growing upward momentum. Additionally, it remains above the 21-period Simple Moving Average (SMA), a critical technical support level that further confirms the positive trend. The upcoming macroeconomic events that may impact the market sentiments include an update on the AU Cash Rate, US Flash Manufacturing PMI and US Unemployment Claims, etc., released weekly.

Global Markets Wrap-Up 

Wall Street closed the week on a strong note, with major indices extending their rally. The S&P 500 climbed 5.27% to finish at 5,958.38, while the NASDAQ Composite led the gains with a 7.15% surge, closing at 19,211.10. On the economic front, the U.S. Department of Labor reported that seasonally adjusted initial jobless claims remained unchanged. For the week ending May 10, 2025, claims totalled 229,000, the same as the previous week, indicating continued stability in the labor market. 

Having understood the US market performance over the past week, taking cues from major global news, and based on technical analysis of the ASX All-Ordinaries Index (.AORD) for the upcoming week, now let us have a look at one ASX-listed stock from the technical standpoint. Noted below recommendation is based on entry price, target prices, and stop-loss for SomnoMed Limited (ASX: SOM) for the next 2-4 weeks duration: -

SomnoMed Limited (ASX: SOM)

Noted below are the key price indicators for the stock:

Price Action Analysis (On the Weekly Chart)

On the weekly chart, SOM continues to hold above a key falling trendline support, suggesting the potential for sustained bullish momentum. This support zone has played a pivotal role in maintaining positive investor sentiment and preserving the stock’s upward bias. In the short-term outlook (2–4 weeks), SOM is approaching a critical resistance level at AUD 0.635. A decisive breakout above this level, especially if supported by strong volume, could spark renewed buying interest and pave the way for a potential advance toward the next target at AUD 0.680.

Technical Indicators Analysis (On the Weekly Chart)

On the weekly chart, the 14-period Relative Strength Index (RSI) is currently around 56.97, reflecting a recovery from previous lows as the stock extends its rebound. Volume analysis further supports the bullish outlook, indicating sustained buying interest. Meanwhile, SOM remains above its 21-period Simple Moving Average (SMA), which continues to serve as dynamic support, reinforcing the stock’s positive near-term trend.

General Recommendation:

As per the above-mentioned price action and technical indicators analysis, SomnoMed Limited is looking technically well-placed on the chart, and a ‘Speculative Buy’ recommendation has been given on the stock. Investment decision should be made depending on an individual’s appetite for an upside potential, risks, and any previous holdings. This recommendation is purely based on technical indicator analysis, and fundamental analysis has not been considered in this report. SomnoMed Limited (ASX: SOM) was last covered in a report dated '22 April 2020'. Summary of recommendation is as follows:

Markets are trading in a highly volatile zone currently due to certain macro-economic and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing. 

Upcoming Major Global Economic Events

Market events occur on a day-to-day basis depending on the frequency of the data and generally include update on employment, inflation, GDP, consumer sentiments, etc. Noted below are the upcoming week's major global economic events that could impact the ASX All-Ordinaries Index and listed stocks’ prices:

Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.

Kalkine reports are prepared based on the stock prices captured from either REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’

Note 1: Past performance is not a reliable indicator of future performance.

Note 2:Individuals can consider exiting from the stock if the Target Price mentioned as per the technical analysis has been achieved and subject to the factors discussed above.

Note3: How to Read the Charts?

The Green colour line reflects the 21-period moving average while the red line indicates the 50-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The Black 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.

The Blue colour bars in the chart’s lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume. Liquidity in stocks helps in easier and faster execution of the order.

The Orange colour lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices. 

Risk Reward Ratio: Risk reward ratio is the difference between an entry point to a stop loss and profit level. This report is based on ~60% Stop Loss of the Target 1 from the entry point.

A trailing stop-loss is a modification of stop-loss in case of favourable movement in the price to protect the gains. Individuals can Trail the Stop-Loss as per the aforementioned levels if the stock price achieves more than 50% of the Target 1.Individuals should consider exiting from the position as per the Trailing Stop-Loss level if the price starts moving downwards after achieving more than 50% of the Target 1.

The reference date for all price data, currency, technical indicators, support, and resistance levels is May 19, 2025. The reference data in this report has been partly sourced from REFINITIV.

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

AUD: Australian Dollar

RSI: Relative Strength Index 

Note: Trading decisions require a thorough analysis by individuals. Technical reports in general chart out metrics that may be assessed by individuals before any stock evaluation. The above are illustrative analytical factors used for evaluating the stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.