Spotlight on the ASX: Top 3 Stocks With Technical Setups You Can’t Ignore

Whether you are a seasoned trader or just getting started, the Australian Securities Exchange (ASX) continues to present fresh opportunities. Recent data paints a supportive backdrop, with March inflation easing to 2.4% YoY and Q4 2024 GDP expanding by 0.6 % QoQ, indicating resilience in the domestic economy.

As expected, the Reserve Bank of Australia (RBA) held its cash rate steady at 4.1% in April, following a 0.25% rate cut earlier in February. What stood out was the RBA’s cautious yet balanced tone. Policymakers signalled growing confidence that inflation is moving sustainably toward the midpoint of its 2-3% target range but also highlighted how global risks remain significant, with all eyes still laser-focused on U.S. tariff developments.

So what does this mean for markets? With inflation cooling and the RBA remaining data-dependent, the door remains open for further rate cuts ahead. Against this backdrop, traders are watching the ASX closely, and we have our eyes on three standout stocks that are shaping up with compelling narratives and eye-catching technical setups.

1. Qantas Airways Ltd. (ASX: QAN)

Qantas, Australia’s largest airline, is bouncing back in style. In our last update, the airline posted a solid AUD 1.39 billion of underlying profit for the six months that ended 31 Dec 2024, driven by a surge in travel demand. Since then, Qantas CEO Vanessa Hudson has also forecasted a favourable fuel and currency environment in 2025 with a stronger AUD benefiting airlines. With a significant fleet upgrade underway, QAN looks poised for stronger performance this year.

Ticker: QAN, Timeframe: Daily

Link to chart: https://www.tradingview.com/x/GEAhmdl5/

QAN has rebounded from the lows seen last month and is now approaching the $10.30 swing high resistance. A strong break and close above this level could trigger further upside toward the next resistance area at $11.20, which aligns with the 127.2% Fibonacci Extension. The MACD remains in bullish territory, reinforcing positive momentum and supporting the potential for further upside in the near term.

However, if the price experiences a deeper retracement, we could see a retest of the $9.00 support zone, which is an area of strong Fibonacci confluence in line with 61.8% Fibonacci Extension and 50% Fibonacci Retracement. Stronger bearish pressure could take the price lower toward the $7.50 support zone as well.

2. ANZ Group Holdings Ltd. (ASX: ANZ)

ANZ is one of Australia’s “Big Four” banks that dominate the local banking scene. Although the company posted its strongest half-year revenue on record in its 1H FY’25 results with a 5% increase, the bank itself has been suffering from reputational damage, with instances of bad trader behaviour drawing flak from the media and punishment from regulators. Adding to the troubles is a broader tightening of margins as interest rates are expected to fall in Australia. ANZ’s newest chief executive, Nuno Matos, has much to set straight within ANZ.

Ticker: ANZ, Timeframe: Daily

Link to chart: https://www.tradingview.com/x/Ba8iZtDY/

ANZ is trading within an established descending channel and has recently reversed from its upper boundary earlier this month. With the MACD signalling a bearish crossover, the price could extend its decline towards the $26.50 support zone and 100% Fibonacci Extension. A bearish move below the $26.50 support zone could drive the price toward the channel’s lower boundary at around $25.70.

However, a break above the $30.50 resistance zone could invalidate this bearish outlook, opening the door for a retest of the next swing high at $31.80, which aligns with the 78.6% Fibonacci Extension.

3. Pilbara Minerals (ASX: PLS)

Pilbara Minerals is a Perth-based leading global producer of lithium materials, with a strong presence in the rapidly growing battery materials sector. The company owns and operates the world’s largest independent hard rock lithium operation. However, the company faces both revenue pressure from declining lithium prices and operational setbacks due to constant weather disruptions. This is further compounded by broad economic uncertainty and fluctuating commodity prices that have put a hold on the company’s growth potential.

Ticker: PLS, Timeframe: Daily

Link to chart: https://www.tradingview.com/x/aLcqKywd/

PLS remains in bearish territory, trading below both the Ichimoku Cloud and the descending channel. Despite the recent rebound, the downtrend remains intact, characterised by a series of lower highs and lower lows. If the price continues to retrace, a pullback to the $2.05 resistance zone, an area of strong Fibonacci confluence, may be on the cards.

Should bearish momentum return at around $2.05, the price could reverse back toward the $1.23 swing low. A sustained break below this support level may open the door to further downside, with the next key support at $0.75, aligning with the 161.8% Fibonacci Extension. Conversely, a bullish breakout of the descending channel could signal a shift in trend, paving the way for a move toward the resistance at $2.62.

The ASX is setting the stage for some sharp moves, especially with potential RBA rate cuts in play. These top 3 stocks each come with compelling narratives and price action-based setups that are not to be missed. Stay tuned for the RBA’s upcoming decision on interest rates and keep a close watch on key earnings updates and headlines that could drive the next move.