Eye on Stock:
MUHIBBAH Engineering (M) Bhd shares were on the rise over the past couple of weeks, albeit gradually, up from 86.5 sen on July 8 to an intra-day high of 97 sen before trimming gains to settle at 93 sen, up 1.5 sen yesterday.
An encouraging landscape appears to be taking shape following the recent development. Based on the daily bar chart, prices had penetrated the mid-term bearish descending line. For now, the breakthrough is viewed as a tentative bullish reversal. Going forward, a decisive penetration of the important 200-day SMA of RM1.01 would give investors the confirmation.
Apparently, the oscillator per cent K reversed up from the 60% level and climbed over the oscillator per cent D of the daily slow-stochastic momentum index to trigger a short-term buy yesterday.
Also on the upward thrust, the 14-day relative strength index firmed from a reading of 29 on July 8 to the 72-point level yesterday.
Similarly, the daily moving-average convergence/divergence histogram continued to expand positively against the daily signal line to stay bullish. It flashed a buy on July 20.
Technically, the indicators suggest a steadier trend in the immediate term.
In the case of a buliish breakout, look for the RM1.20–RM1.22 level as the next upside target. Greater resistance is resting at the RM1.40 mark, followed by the RM1.60–RM1.70 band.
Support is pegged at the 21-day simple moving-average of 90 sen, followed by the recent ebb.
● The comments above do not represent a recommendation to buy or sell.
By K.M. LEE
thestar.com.my
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