Friday, April 06, 2012

TWSPLNT may have a bullish breakout

TWSPLNT has just broken above the neckline of its inverted Head-&-Shoulder formation at RM5.25. The volume is relatively thin. If you measure the distance between the tip of the Head & the neckline (about RM1.50) & super-impose that to the breakout point at RM5.25, the potential target for this move will be RM6.75. Let's take it as RM6.80.

Chart: TWSPLNT's weekly chart as at April 6, 2012_11.00am (Soure: Quickcharts)

Based on this technical breakout, TWSPLNT could be a trading BUY.

(Note: Due to some delay, the stock has now rallied to RM5.49!)


Jimmy Yeoh said...

Hi Alex,

Can you comment on Coastal?


luckystock2 said...

Hi Alex ,
Can you comment on TWS also? I've been waiting for the price around 8.90 to buy more.I think the valuation is still very attractive like what you have posted before.

Alex Lu said...

Hi Jimmy Yeoh

Coastal is a very tricky stock. While it is an attractive stock on paper, its movement does not reflect this. In fact, its share price movement seems to suggest that all is not well with this company.

Chartwise, if Coastal is now testing its long-term uptrend line from 2006 (based on semi-log chart). That uptrend line support is at RM1.90. As such, it is important that the stock stay above that level or else it may be technically a damaged stock.

Alex Lu said...

Hi luckystock2

I have posted on TWS recently. I agree that the company is fairly attractive and as such, it may be worth investing in.

Chartwise, TWS is in a holding position. If the stock were to break below its 40-week EMA line at 9.30-9.40, its uptrend would be in doubt. On the other hand, if it can break above its recent high at RM10.60, it may continue its uptrend.

You may ask why would TWS go down if it's an attractive stock. If that ever happened, I think it would be due to political reason. TWS is a distributor of two important commodities- rice & sugar- as well as being involved in oil palm cultivation.

The distribution of rice & sugar is a monopoly & an oligopoly, respectively. That they are subsidized by the government and the major shareholder (Syed Mokhtar) is closely linked to UMNO, could put TWS in a uncomfortable position if the political scene were to change dramatically in the next election. I think this could be the political baggage that Syed Mokhtar's group of companies has to shoulder.