What's the real story, Ramunia?

Ramunia has a bullish breakout of a flag formation at around RM0.57-58. To estimate the potential target for the current "pole", one has only to add the previous "pole" (of RM0.38-40) to breakout point (at RM0.57-58). Thus, the target for this move is RM0.95-98. For more on Flag, go here.


Chart: Ramunia's 15-minute chart as at 3.20pm 11/5/2009 (Source: Quickcharts)

I have earlier posted about Ramunia's proposed sale of all its businesses & assets to Sime Darby Engineering (SDE) and arrived at a value of about RM0.35 per share. This valuation is quite similar to valuation done by other research analysts but the share price of Ramunia since its re-quotation on last Friday has never traded anywhere near that price. That coupled with the bullish breakout of the flag formation are indications that the final deal may be different from what was announced earlier. Is that possible? If the main points were not finalized, then the stock(s) should remain suspended. We will have to wait & see.

The above technical analysis is strictly for your information only. While the bullish breakout could be a trading BUY under normal circumstances, Ramunia is a stock that I thread with lot of caution.