Lynas Rare Earth Limited (ASX: LYC)

Lynas Rare Earth Limited (ASX: LYC) is engaged in the integrated extraction and processing of rare earth minerals, primarily in Australia and Malaysia, and the development of rare earth deposits.

Recent Developments: LYC signed a letter of agreement with Japan Australia Rare Earths B.V. (JARE). Under the agreement, LYC and JARE become parties to a long-term senior loan facility comprising of principal payment of USD 141mn. During the quarter ending September, LYC realized sales receipts of AUD 163.8mn, and REO production clocked at 3.5kREOt. It had commenced an exploration program at Mt Weld with the funding support of USD 9mn. LYC is targeting the production of 12kt per annum finished NdPr oxide.

Technical Analysis: On the weekly chart, LYC prices are trading above the rising trendline and taking the support from the same. Moreover, the momentum oscillator RSI (14-period) is showing a reading of ~51.71 level, indicating positive momentum. Further, the prices are trading above the trend-following indicators 21- period SMA, which may act as support zone. An important support level for the stock is placed at AUD 7.400 while the key resistance level is placed at AUD 10.500.

Considering the company’s current price levels are sustaining above the upward sloping trend line, and momentum oscillator analysis, it is prudent to recommend a ‘Speculative Buy’ rating on this stock. The stock was analysed as per the closing price of AUD 8.680 per share on 02^nd November 2022, up ~0.462%.

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

Weekly Technical Chart – LYC

Scorpion Minerals Ltd. (ASX: SCN)

Scorpion Minerals Ltd. engages in the exploration of mineral resources. It focuses on copper exploration in Murchison, and Kimberley regions of Western Australia. SCN holds a market capitalization of AUD 23.35mn as of 2^nd November 2022.

Technical Analysis: On the daily chart, SCN’s stock price is in the consolidation phase and facing resistance at the falling trendline, indicating the possibility of a downward move hereon. Moreover, RSI (14-period) is below the mid-point and showing a reading of 44.529 and supporting a downside correction. Further, prices are sustaining below the trend-following indicators 21-period and SMA 50-period SMA, which may act as a resistance zone for the stock. An important support level for the stock is AUD 0.063, while the key resistance level is AUD 0.077.

Considering the company’s current price levels encountering resistance at the trendline, momentum oscillator analysis, therefore a ‘Watch’ recommendation is given on the stock. The stock was analysed as per the closing price of AUD 0.070 per share as on 1^st November 2022.

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest, taking into consideration the risk-reward scenario.

Daily Technical Chart – SCN

Miramar Resources Limited (ASX: M2R)

M2R operates as an exploration company with projects in the Eastern Goldfields, the Murchison, and Gascoyne regions. M2R holds a market capitalization of AUD 6.43mn as of 2^nd November 2022.

Technical Analysis: On the daily chart, M2R’s stock price has facing resistance at the falling trendline, indicating the possibility of downside correction hereon. Moreover, the momentum oscillator RSI (14-period) is below the mid-point and showing a reading of ~40.111. Further, the prices are trading below the trend-following indicators 21-period SMA and 50-period SMA, which may act as a resistance zone in the near term. An important support level for the stock is at AUD 0.082, while the key resistance level is at AUD 0.108.

Considering the company's current price levels have facing resistance and momentum indicator analysis, a 'Watch' recommendation has been given on the stock. The stock was analysed as per the closing price of AUD 0.091 per share as on 2^nd November 2022.

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest, taking into consideration the risk-reward scenario.

Daily Technical Chart – M2R

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: Investment decision should be made depending on an individual’s appetite for upside potential, risks, and any previous holdings. This recommendation is purely based on technical analysis, and fundamental analysis has not been considered in this report.

Note 3: 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.

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.

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

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

The Orange/ Yellow colour line represents the Trendline.

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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