Gamuda, viewed from a long-term perspective

Gamuda had a strong rebound over the past seven weeks, rising from a low of RM2.06 recorded on June 23rd to close at its high of RM3.02 last Friday. At the close of the morning session today, the share price dropped 20 sen to RM2.82. This is below the strong horizontal resistance of RM2.85-90 as noted earlier (go here).

A study of Gamuda's monthly chart revealed that the stock had a tendency to end its downtrend in the form of a double bottom reversal. These are marked out as 'A-A1' in 1998 and 'B-B1' in 2006. If this were to recur, then we may see Gamuda's share price re-testing its recent low of RM2.06. This may not happen anytime soon, but it is a possibility that we should bear in mind.


Chart: Gamuda's monthly chart as at August 15th (source: Quickcharts)