Wednesday, April 25, 2012

Some interesting stocks to consider

After two days of correction, some stocks have dropped to their immediate support level while others have broken marginally below the support. I have appended below a few stocks for consideration or further action.

1. Stocks that have broken important support level

These include Armada, which broke its uptrend line, & DRBHcom, which broke to the downside of its triangle. Any bearish breakout, with volume & not rectified within a short period, will trigger further selldown.


Chart 1: Armada's daily chart as at April 24, 2012 (Source: Quickcharts)


Chart 2: DRBHcom's daily chart as at April 24, 2012 (Source: Quickcharts)

2. Stocks which are at their important support level

These include Genting, Airasia, Allianz & TWS. The last three names are or will soon be testing their strong support level. This may set the stage for a decent rebound. However, a breakdown of a strong support level could trigger strong selldown.


Chart 3: Genting's daily chart as at April 24, 2012 (Source: Quickcharts)


Chart 4: Airasia's daily chart as at April 24, 2012 (Source: Quickcharts)


Chart 5: Allianz's weekly chart as at April 24, 2012 (Source: Quickcharts)


Chart 6: TWS's daily chart as at April 24, 2012 (Source: Quickcharts)

For readers who have been waiting for a correction to get into the market, this could be the time to start screening through the charts & slowly nibble your selected stocks. Aggressive buying may not be prudent strategy as the market condition is fragile.

10 comments:

x said...

hi alex,

what do you think of dialog? It seems staying at the support line quite some time.
thanks

Nighelangelo said...

TA on stocks or commodities has some justification, but TA on indexes is questionable.

Jimmy Yeoh said...

Hi Alex,

Can you comment Navis Capital to trigger GO for SEGi?

Mark said...

hi alex,

pls comment on buying in telekom (div + cap repayment) and tenaga ?

Bee said...

Alex,

would appreciate your views on Digi. Thanks a lot.

Alex Lu said...

Hi Jimmy Yeoh

Navis Capital, together with Clement Hii, proposed to acquire SEGi at RM1.81 per share. There is not much to add to that announcement.

Ignoring proposed buyout, SEGi looks like it is trapped in a rounding top which has just given a sell signal. If you draw a oval- centered in October 2011; spanning April 2010 to April 2012; and enveloping the price range of RM1.55 & RM2.00- you would notice that the price has just dropped out of that oval formation.

However, with the buyout in place, I do not think the sahre price will drop too much from RM1.81. Nevertheless, it is advisable to reduce position in this stock.

Alex Lu said...

Hi x

Dialog has been holding very well at the support of RM2.20. If it can break above the RM2.30 resistance, it may slowly rise back up to its recent high of RM2.50.

Alex Lu said...

Hi Nighelangelo

I don't agree with your statement: TA on stocks or commodities has some justification, but TA on indexes is questionable.

TA is applicable for all financial assets, provided there is sufficient liquidity & depth. We cannot take FBMKLCI's recent performance, which is completely not in line with global markets as well as our own broader market, to come to that conclusion. Occasionally things like this happened. Have you heard of Nifty Fifty?

Alex Lu said...

Hi Mark

I will give you my technical take on telekom and tenaga. TM is in an uptrend (everybody knows that, you may say). If you are looking to get in, try buying when it pulls back to the 50-day SMA line (currently at RM5.23).

Since 2008, Tenaga has been moving within a big range between RM5.00 & RM7.00. Currently, its support is at RM6.00 & resistance at RM6.70.

Alex Lu said...

Hi Bee

Digi's results dropped slightly which is not a serious concern. See the link below.

Chartwise, it has good support at RM3.80-3.85 (horizontal support & 20-week SMA line). However, it has just broken above the medium-term downtrend line at RM4.00 yesterday. If you like to get into the stock, you can do so on weakness provided it does not drop back below RM4.00.

http://announcements.bursamalaysia.com/EDMS/edmsweb.nsf/ba387758ae37412b482568a300466fb6/5cc300369e2ebde6482579eb0033813a/$FILE/MDA%20Q112%2025%20APRIL.pdf