This report is an updated version of the report published on August 01, 2023, at 08:00 AM GMT+1.

Company Overview: Aston Martin Lagonda Global Holdings PLC (LON: AML) is a United Kingdom-based holding company that designs, engineers, manufactures, and markets cars. PayPoint PLC (LON: PAY) is an FTSE AIM All-Share index-listed consumer payment services provider. PAY has three business segments: Bill payments, Top-ups and eMoney, and Retail Services. This Report covers the Price Action, Technical Indicators Analysis along with the Target Levels, Stop Loss, Support Levels, Resistance Levels, and Recommendations on these two stocks.

FTSE All-Share Index (.FTAS) Market Round-Up

Last week, the benchmark FTSE All-Share Index (.FTAS) started marginally positively and traded with a positive bias for the entire week. The index made a high of 4207.98 during the week and settled at 4195.17 with an overall gain of ~0.30 percent for the week ending July 28, 2023. The recent week started marginally positively, and prices are trading around the 4200 level.

On the technical front, the index is consolidating above a downward sloping trend line breakout level, indicating the possibility of a sideways to positive movement. On the daily chart, the RSI (14-period) is moving above the midpoint with a reading of 64.92, and the current market price (CMP) is above the 50-period and 21-period SMAs, supporting an upward trend.

Global Markets Wrap-Up

Wall Street witnessed positive movement last week and the two benchmark indices ended in the green. The S&P 500 settled at 4582.24 with a gain of ~1.01 percent, while the NASDAQ Composite Index settled at 14316.658 with a gain of ~2.02 percent for the week ending July 28, 2023. 

Having understood the US market performance over the past week, taking cues from major global news, and based on technical analysis of the FTSE All-Share Index (.FTAS) for the upcoming week, now have a look at the two LSE-listed stocks picks from the technical analysis standpoint. Noted below are the recommendations based on entry price, target prices, and stop-loss for Aston Martin Lagonda Global Holdings PLC (LON: AML) and PayPoint PLC (LON: PAY) for the next 2-4 weeks duration: 

Aston Martin Lagonda Global Holdings PLC (LON: AML)

Noted below are the key price indicators for the recommended stock:

Price Action Analysis (on the Weekly Chart)

AML’s prices are sustaining above a crucial resistance level of GBX 389.40 for the past couple of sessions, indicating the possibility of further upside movement hereon. The recent upside movement in the stock is accompanied by volumes as well, further supporting a positive bias. Now the next important resistance level for the stock appears at GBX 455.00, and prices may test this level in the short term (2-4 weeks). A further movement above GBX 455.00 may extend buying in the stock.

Technical Indicators Analysis (On the Weekly Chart)

On the weekly chart, the RSI (14-Period) is moving in a positive zone and showing a reading of ~73.24. The volumes also seem supportive of an upside movement. The CMP is above the trend-following indicators 21-period and 50-period SMAs, which may act as the support levels in the near term.

General Recommendation:

As per the above-mentioned price action and technical indicators analysis, Aston Martin Lagonda Global Holdings PLC is looking technically well-placed on the chart, and a ‘Speculative Buy’ recommendation has been given on the stock. Aston Martin Lagonda Global Holdings PLC (LON: AML) was last covered in a report dated ‘14 June 2023'. Investment decisions 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. The summary of recommendation is as follow:

PayPoint PLC (LON: PAY)

Noted below are the key price indicators for the recommended stock:

Price Action Analysis (on the Daily Chart)

PAY’s prices are sustaining above a downward sloping trend line breakout level, indicating the possibility of further upside movement. The recent upside movement in the stock is accompanied by volumes as well, further supporting the positive bias. Now the next important resistance level for the stock appears at GBX 582, and prices may test this level in the short term (2-4 weeks). A further movement above GBX 582 may extend buying in the stock. 

Technical Indicators Analysis (On the Daily Chart)

On the daily chart, the RSI (14-Period) is moving in a positive zone and showing a reading of ~75.55. The volumes also seem supportive of an upside movement. The CMP is above the trend-following indicators 21-period and 50-period SMAs, which may act as the support levels in the near term.

General Recommendation:

As per the above-mentioned price action and technical indicators analysis, PayPoint PLC is looking technically well-placed on the chart, and a ‘Speculative Buy’ recommendation has been given on the stock. PayPoint PLC (LON: PAY) was last covered in a report dated '24 January 2021'. Investment decisions 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. The summary of recommendation is as follow:

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

Upcoming Major Global Economic Events

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

Related Risks: This report may be looked at from a 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.

Note 1: 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. 

Note 2: 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 and 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: In general, 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 July 31, 2023. The reference data in this report has been partly sourced from REFINITIV. 

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

GBP: British pound sterling

GBX: British pence sterling

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.

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