Camerlin about to test its uptrend line

On February 16, Camerlin has announced its proposal to undertake a capital distribution of up to 303.14 million BIL International Ltd ('BIL') shares to its own shareholders, via a capital reduction exercise and cancellation of its share premium reserve. It will distribute between 0.65 and 0.67 BIL share for each Camerlin share held via a reduction of its share capital by up 87 sen per Camerlin share, amounting to RM405.7 million and the reduction of its share premium reserves by up to RM689.2 million. For the full announcement, go here.

You may also like to check out the recent renewed interest in Camerlin (here), which has a lot to do with its associate, BIL's aggressive plan to be a significant player in Britain's gaming industry, by opening a casino in more than half of the Thistle Hotel chain (which belongs to BIL).

Prior to the announcement, the share price of Camerlin was rising steadily but this has since been reversed. Next week could be an interesting week for Camerlin. Its share price could test its immediate uptrend line support at RM2.35. A break of this support might bring the share price down to the strong horizontal support of RM2.28/30. If that also could not hold up this stock, the next support would be the medium-term uptrend line support as well as a horizontal support of RM2.10.

Chart: Camerlin's daily chart as at Feb 23

Watch the share trading for this stock carefully next week. If the share can rebound from any one of the above support level with good volume, it could be a signal to buy into this stock.