MHB- poised to test its uptrend line support

Two weeks ago, I've posted about the exciting prospect for MHB (here). However, I have also noted that the technical reading is bearish for the near term as I expect the stock to pull back to the uptrend line support at RM7.80. The trading of the stock over the past two weeks was pretty close to my forecast. It is now at the uptrend line support. If this uptrend line can hold, this could be a good entry for a trading BUY or a medium-term BUY for the stock. To be sure, you may want to see a rebound off the uptrend line before gaining entry.


Chart: MHB's daily chart as at July 26, 2011_10.30am (Source: Quickcharts)

Note: One of the possible reason for the drop in the share price today as well as over the past 2 weeks is that MHB failed to secure the contract to build the integrated petro-chemical complex in Teluk Ramunia, which went to a consortium made up of KNM, Zecon & Gulf Asian Petroleum Sdn Bhd (here). That contract is estimated to be about RM15 billion. Nevertheless, there are more contracts to be dished out & MHB, with its strong track record, should be able to get its fair share of the contracts.