Monday, April 08, 2013

Puncak- the beginning of a recovery?

Puncak broke above its long-term downtrend line, RR at RM1.30 in early March. Last week, Puncak broke above its strong horizontal resistance at RM1.60. It is set to test its next resistance at the psychological RM2.00 mark.

Puncak's future is closely tied with the outcome of the General Election as its major shareholder, Rozali is considered to be an UMNO man. If BN can recapture Selangor from Pakatan, investors would expect a better deal for Puncak. If the state government remained in the hands of Pakatan, the valuation of the stock would lower. OSK valued Puncak in early March at RM2.00 (here).

Based on technical breakout, Puncak can be an interesting trading BUY.

Chart 1: Puncak's weekly chart as at April 8, 2013_10.00am (Source: Quickcharts)

Chart 2: Puncak's monthly chart as at April 5, 2013  (Source: Quickcharts)

In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, Puncak.


hkloon said...

Hi Alex,

Any view that Construction sector will rally a bit b4 election? At least breaking some key resistance at the bottom.


Alex Lu said...

Hi hkloon,

Logically, that is one sector that would do well regardless of whoever is in Putrajaya. Even Gamuda bosses, who the market thinks are aligned with BN, would change horses if Pakatan wins. That's the fact of life!

We must overcome our FEAR...