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Wednesday, August 29, 2018

CIMB: Next Upleg Starting Soon?

CIMB finally broke above the resistance from the horizontal line at RM6.00 yesterday. The breakout may signal an upswing to RM7.00 price level again. The immediate resistance will be the horizontal lines at RM6.20 and RM6.40 while the immediate support will be the horizontal lines at RM6.00 and RM5.80.


Chart 1: CIMB's weekly chart as at Aug 28, 2018 (Source: Malaysiastock.biz)

If you look at the next chart, you will see that CIMB - weighed down by negative news after GE14 - tested its intermediate uptrend line, SS at RM5.20 in July. Its lagging indicators (MACD & DMI) are either positive or may soon turn positive.


Chart 2: CIMB's daily chart as at Aug 28, 2018 (Source: Malaysiastock.biz)

Those who are very bullish on CIMB and wish to take a leveraged bet on this stock, may consider CIMB-C37. One good warrant screener to use for picking warrants that fit your requirement is KLSE Warrant Screener (here). All you have to fill in the blanks as follows:
1. Select Stock (CIMB)
2. Type (Call)
3. Maturity (more than 90 days)
4. Premium (less than 10%)

The result is shown below.


Table: CIMB's CWs (Source: klsescreener.com/v2/screener-warrants)

UPDATE: KLSE Warrant Screener has one shortcoming of not including the warrants' conversion ratio in the table. This omission does not affect the premium computed by the website as it is still correct based on my cross checking. However, as a user, I like to have all the terms on one page for my own computation. In the case of CIMB-C37, the conversion ratio is 6-to-1 which means you need 6 units of C37 to "convert" to 1 unit of CIMB share in theory. In practice, all CWs are cash settled instead of going thru the hassle of physically settlement. I hope the publisher of KLSE Warrant Screener will look into this omission soon. Despite this omission, it is an excellent tool for investors and traders to use. 

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

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