Thursday, January 02, 2014

Airasia- technical outlook is not promising

Since my post on Airasia in November (here), the stock continued to slide. From the semi-log chart below, Airasia has broken below its long-term uptrend line, SS as well as the lower boundary of its downward channel. These double breakdowns will be very negative for the near-term outlook for this stock. It is likely to test the psychological RM2.00 support. Below that, the next support will be the horizontal line at RM1.50.

This technical outlook is opposite the more positive outlook in a few analysts' reports on the stock. As such it is difficult to come a conclusion as to which way the stock may go. In such situation I would recommend that any buying into this stock should be carried out slowly.

Chart: Airasia's weekly chart as at Dec 31, 2013 (Source: Tradesignum)

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, Airasia.

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