Bursa has a bullish breakout

Bursa broke above the triangle formation at RM7.40 on July 24 as well as closing above its recent high of RM7.50 on that day (see Chart 1). With this breakout, Bursa is likely to test its next resistance at RM8.00-8.40 soon (see Chart 2). Bursa may test the psychological level of RM10.00 as the current market rally gathered momentum.

Kenanga has maintained its BUY call on Bursa with an upward revision in the FY2010 net profit of 26% to RM163 million (or, EPS of 30.96 sen). The revision was made based on Bursa's proposal to remove the current cap on clearing fee charges for institutional trades. This proposal, if implemented, could lead to a 15-20% increase in turnover.


Chart 1: Bursa's daily chart as at July 27, 2009_11.45am (Source: Quickchart)


Chart 2: Bursa's weekly chart as at July 27, 2009_11.45am (Source: Quickchart)

Based on technical consideration, Bursa is a good trading BUY now.