Standard Life Aberdeen PLC 

Standard Life Aberdeen PLC (LON: SLA) is an UK based capital market company, headquartered in Scotland. It provides asset management services to institutional, wholesale, and strategic insurance clients. It also offers financial planning, wealth management, and advisory services.

As per our previous recommendation on SLA as on December 01, 2020, we recommended a ‘Buy’ rating on the stock for 2-4 weeks duration from the technical analysis standpoint. However, considering the recent price action, technical indicators analysis, and low double-digit returns we are of the view that it is prudent to book profits at the current levels. Some correction could be witnessed considering less trading volumes and shortened trading sessions during the ongoing week. Hence, we give a 'Sell' rating on the stock at the current price of GBX 298.70 (as on December 29, 2020, before the market close at 09:40 AM GMT). The summary of our 'Sell' rating and price movement since the previous recommendation for SLA is provided as below:

Price action and technical indicator analysis (on the weekly chart):

SLA’s prices moved up by ~12.61 percent from the recommended entry-price and made a high of GBX 299 on December 29, 2020. Prices broke the major resistance level of GBX 288.30 on December 03, 2020 but were unable to catch an upside rally and are currently hovering around the breakout level. Now an immediate support level for the stock is at GBX 271.00 and any breakout below that may start a fresh selling.

RSI (14-period) is trading in a tight range of ~55 to ~63 from the last one month indicating lack of directional movement although prices are still sustaining above 21-period and 50-period SMA, providing support to the stock.

Conclusion:

Based on the above-mentioned price action, RSI (14-period), support and resistance level analysis, we recommend a ‘Sell’ rating on SLA and suggest investors to book profit at the current price of GBX 298.70 (as on December 29, 2020, before the market close at 09:40 AM GMT).

Investment Related Risks: Based on the technical analysis, the risks are defined as per risk-reward ratio (~0.60:1.00), however, returns are generated within 2-4 weeks’ time frame. This may be looked at by Investors with sufficient risk appetite looking for returns within short investment duration. Investment recommendations provided in this report are solely based on technical parameters, and 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, and social and political instability risks etc.

Note: 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 we consider stocks with greater than or equal to 200,000 volumes as more liquid. 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.

The reference date for all price data, volumes, technical indicators, support, and resistance levels is December 29, 2020, before the market close at 09:40 AM GMT. 

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 investors. Technical reports in general chart out metrics that may be assessed by investors 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. Our publications are NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) or engage in any investment activity under discussion.  Past performance is neither an indicator nor a guarantee of future performance.

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