Eye on stock
AIC Corp Bhd pulled back from the recent peak of 91 sen on March 29 to a low of 56.5 sen on Aug 9 amid extended correction process before fresh bargain hunting interest came to the rescue, lifting them to a near three-month high of 81 sen yesterday.
Based on the daily bar chart, prices had penetrated the short-term descending line of 66 sen on Thursday, aided by bigger trading volumes and they are now trading above all the moving averages on our radar screen.
In theory, a decisive breakthrough like this, indicates the recent correction mode has ended and the next logical phase would be a new leg of uptrend.
Further supporting the fact, the oscillator per cent K and the oscillator per cent D of the daily slow-stochastic momentum index extended the scaling to the bullish territory. It triggered a short-term buy at the bottom earlier of the week.
Tracing out a similar pattern, the 14-day relative strength advanced from the neutral area to finished at 72 points yesterday.
In addition, the daily moving average convergence/divergence histogram sustained the upward expansion against the daily signal line to stay bullish. It issued a buy in mid-week.
Technically speaking, AIC Corp shares has the potential to challenge the RM1 – RM1.08 heavy resistance band in the near-term. If they can bomb out from this barrier, a massive rally can be expected. The next overhead barrier is resting at the RM1.50 level, followed by the RM2 mark.
Current support is envisaged at the 100-day simple moving average of 71 sen, followed by the 66 sen line.
By K.M. LEE - thestar.com.my
> The comments above do not represent a recommendation to buy or sell.
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