Wednesday, July 27, 2011

Kulim- may have a bullish breakout

Kulim broke above its downtrend line this morning. This upside breakout is deemed very strong as Kulim opened with a gap up this morning. This reminds me of another gap up breakout in February 16 when it announced the entitlement date for its share split cum bonus issue of shares & warrants (here). Is Kulim about to announce something big again? Only time will tell.

From the chart below, we can see Kulim broke above the medium-term downtrend line at RM3.60. Its immediate resistance are the horizontal line at RM3.73 & then at RM4.00.


Chart 1: Kulim's daily chart as at July 27, 2011_9.30am (Source: Quickcharts)

Those who are more aggressive may consider Kulim-WC, a newly-listed warrant with an exercise price of RM3.85 & expring only in February 2016. This warrant is however trading at a hefty premium of 33% (based on current price of RM1.07 & share price of RM3.70).


Chart 2: Kulim-WC's daily chart as at July 27, 2011_9.30am (Source: Quickcharts)

Needless to say that you should exercise your careful discretion in carrying out any trading given the uncertainty in the market presently.
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8 comments:

  1. MelvinWednesday, July 27, 2011 10:09:00 AM

    Hi Alex, any comment on the Armada's warrants that will be launched on tomorrow?

    ReplyDelete
  2. tanWednesday, July 27, 2011 10:27:00 AM

    hi alex,

    what is your opinions on farlim?,the volume is building up & price are higher could this be a potential breakout soon ?

    regard
    tan

    ReplyDelete
  3. frogprinceWednesday, July 27, 2011 10:31:00 AM

    Hi Alex,
    What is your comment on KNM and Zecon? And Zecon's rise has outpaced KNM. Is it a better opportunity to enter KNM now?

    ReplyDelete
  4. Alex LuWednesday, July 27, 2011 11:51:00 AM

    Hi Melvin

    Sorry. I don't know what to say about Armada's sharp rise nor do I have any comment about the warrant.

    ReplyDelete
  5. Alex LuWednesday, July 27, 2011 11:54:00 AM

    Hi tan

    Farlim is a quiet stock. Its financial performance is mediocre. It trades within a range of RM0.30 & RM0.40. You can also draw an intermediate uptrend line with support at RM0.25 as well as long-term downtrend line with resistance at RM0.42. My feeling is that it is just going thru the motion of jumping up to these resistance, either RM0.40 or RM0.42.

    ReplyDelete
  6. Alex LuWednesday, July 27, 2011 12:19:00 PM

    Hi frogprince

    You must have read about the big contract "secured" by a JV in which KNM and Zecon have a share. With a contract of that size (valued at RM15 billion), both stocks should soar. And, they did!

    Zecon has outperformed KNM as it is a smallcap (only 119 million shares cf to KNM's 1.00 billion shares). In addition, it has strong connection with some influential Sarawak politicians, which may give it an extra aura.

    I personally would prefer KNM to Zecon.

    ReplyDelete
  7. mgWednesday, July 27, 2011 10:22:00 PM

    hi Alex, is it the right time to collect Homeriz, is it reach bottom now? TQ.

    ReplyDelete
  8. Alex LuMonday, August 01, 2011 4:26:00 PM

    Hi mg

    I am surprised by the downtrend in Homeriz. I have not looked at this stock for a while. Its results has been disappointing for the past two quarters. However, it is still profitable & its financial position is satisfactory.

    Based on annualized EPS of 3.5 sen & NTA of 30 sen, Homeriz could be a long-term BUY at RM0.20-0.25.

    ReplyDelete