Friday, May 07, 2010

Topglov broke its long-term uptrend line

Topglov broke below its long term uptrend line at RM12.00 yesterday. That uptrend line stretches back to January 2009. In addition, we can see two other negative signs: the MACD entering into the negative territory (potentially a prelude to a sustained decline) and the 20-day SMA line cutting below the 50-day SMA line. We can also note that the RSI is beginning to enter into the 'oversold' territory, where a prolonged stay therein is a prelude for sustained decline. After a sharp fall this morning (to an intra-day low of RM11.18), Topglov has enjoyed a sustained rebound to touch RM11.96 as at 3.45pm.

So, we will wait & see whether the developing rebound can take Topglov back above the uptrend line support at RM12.00 & maybe to rectify the negative technical picture as painted by the indicators. Failing which, Topglov could have made a cyclical top & it could commence on its long-term downtrend shortly thereafter. In fact, a short-term downtrend has already started as seen by the presence of a lower 'low' & a lower 'high' (denoted as L1/L2 & H1/H2).


Chart: Topglov's daily chart as at May 6, 2010 (Source: Tradesignum)

If Topglov has made a top, then chances are that the other rubber glove makers could have made theirs or about to make theirs. After all, Topglov is the top dog in this industry.
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15 comments:

  1. AvatarFriday, May 07, 2010 5:42:00 PM

    Topglov touched a green high of 12.100 from an intra-day low of 11.180 today. What a rebound.

    ReplyDelete
  2. AnonymousFriday, May 07, 2010 6:01:00 PM

    Dear Alex

    Do you have any investment idea on PJ development. In turn of EPS, NTA and dividend yield, these stock seem attractive. Its warrant currently out of money, there should not have dilution impact on its earning

    ReplyDelete
  3. AlexPFriday, May 07, 2010 11:15:00 PM

    Alex,what do you think of the Seremban Engineering IPO that will be listed next Monday? The company looks profitable but is it a good price? Furthermore the timing of the listing is pretty bad with the current market crash!

    ReplyDelete
  4. solomonSaturday, May 08, 2010 2:26:00 PM

    Dear Alex,

    How do you see Johan as a company and technical point of view?

    ReplyDelete
  5. ronnieSaturday, May 08, 2010 10:34:00 PM

    On Top Glove's share price, someone is listening to you. What a rebound indeed !

    Heh heh heh.

    ReplyDelete
  6. ronnieSaturday, May 08, 2010 10:36:00 PM

    Someone is maintaining share prices of Daibochi and Tomypak. Wonder who ?

    Perhaps SC can help.

    ReplyDelete
  7. KitSunday, May 09, 2010 12:20:00 AM

    Dear Alex,

    Petra Perdana is forming a triple bottom probably, may l know is this stock good to buy and at what price I can accumulate?

    Thanks a lot.

    ReplyDelete
  8. Daniel WongSunday, May 09, 2010 2:44:00 PM

    It's interesting to see whether the rebound will be a strong one, or whether it will move sideways or just a short rebound followed by a strong downtrend.

    It rebounded so fast before I could manage to recommend my blog readers to buy =P

    ReplyDelete
  9. solomonSunday, May 09, 2010 6:28:00 PM

    If oil price is going to rebound in 2nd half this year, Petra Perdana is very interesting stock to watch.

    With the accumulation by some local funds, likely it will see some movement next week??

    ReplyDelete
  10. kyongMonday, May 10, 2010 11:37:00 AM

    Dear Alex,
    1)On Latexx, it announces the increased 125% profit per share recently but its price is sliding.Now it is still below THE support @ RM3.60, Indicators are pointing south, I have cashed out 1 week ago when it drifted below both the 14 and 25D EMA.
    2) On Supermx, its descending triangle is being formed, and it is still below SUPPORT line RM6.60, AND IT IS ALSO BELOW THE CRITICAL 50 EMA level. so I WOULD suggest to those who hold this share to decide SOON what to do on re-bounce today?
    Thanks for your comments again.

    ReplyDelete
  11. Alex LuMonday, May 10, 2010 12:08:00 PM

    Hi Avatar & Ronnie,

    If Topglov can stay above the long-term uptrend line support at RM12.00, that would be enough for the uptrend to be intact. It would be better, if it can go above the short-term downtrend line at RM12.40-50. If the latter were to have, the uptrend would very likely to continue.

    ReplyDelete
  12. Alex LuMonday, May 10, 2010 3:12:00 PM

    Hi hng,

    PJ development is trading at a PER of about 6 times or at a Price to Book of 0.4 times. That makes it an attractive stock.

    Chartwise, it is likely to trade sideway, with support at RM0.70-72. However, if it can break to the upside of a 'descending triangle' at RM0.82, its uptrend may continue.

    ReplyDelete
  13. Alex LuMonday, May 10, 2010 3:17:00 PM

    Hi AlexP,

    Seremban Engineering has a EPS for FY2009 of about 11 sen. At the IPO price of RM0.85, its PER is about 7.7 times. A medium-term size company may command a PER of 6-10 times, depending on industry & growth prospect. As such, Seremban Engineering is probably listed at a fair value, with limited upside.

    ReplyDelete
  14. Alex LuMonday, May 10, 2010 3:49:00 PM

    Hi solomon,

    FYE31/1/2010, Johan made a net profit of RM26 million on turnover of RM503 million. EPS was about 4 sen. At the current price of RM0.415, it is trading at a PER of 10 times. I think it is trading near its fair value.

    Johan broke above its descending triangle at RM0.32 on Mar 29. It rose to a high of RM0.445 before consolidating. Can it go higher? Let wait & see.

    ReplyDelete
  15. Alex LuMonday, May 10, 2010 3:55:00 PM

    Hi Kit/Solomon,

    Petra Perdana has a good horizontal support at RM1.20-30. Its long-term downtrend line resistance is at RM1.90.

    With the management problem resolved, the company can concentrate in its business. The catalyst for a re-rating will be when new contracts start flowing in.

    ReplyDelete